Slovenia Business Week no 37, November 20, 2006
Table of Contents:
HEADLINES ............................................................................................................................. 3
Central Bank Sees Signs of Slowdown in GDP Growth ........................................................ 3
September Salaries Up Nearly 4% Y/Y ................................................................................. 3
Amendments to Excise Duties Act Passed ............................................................................. 3
INTERNATIONAL COOPERATION ...................................................................................... 5
PM Inaugurates Joint Venture in Riyadh, Arrives in Kuwait ................................................ 5
PM Wants Stable Economic and Political Relations with Kuwait ......................................... 5
PM Janez Jansa Meets Kuwaiti Emir ..................................................................................... 6
Bosnia-Herzegovina Calls on Slovenia for Aid in EU Accession ......................................... 6
Serbia, Slovenia to Strengthen Ties ....................................................................................... 7
Slovenia to Open Another Consulate in Israel ....................................................................... 7
Slovenia to Aid Bulgaria in Acquiring EU Environment Funds ............................................ 7
EUROPEAN UNION ................................................................................................................. 9
Slovenian, Portuguese Officials Debate EU Presidency Preparations ................................... 9
Slovenia Welcomes Confirmation of EU Services Directive ................................................ 9
Speakers Agree to Push on With Euroregion Plans ............................................................. 10
Schengen Delay Prompts Cukjati and Szili to Write to EU ................................................. 10
Slovenia Not Mulling Closing Labour Market to EU Newcomers ...................................... 11
Slovenia Wins Eurostat Approval for Two Regions Reclassification ................................. 11
Eurobarometer: Slovenians True Euro Connoisseurs .......................................................... 11
LEGISLATION ........................................................................................................................ 13
Parliament Passes Municipality Funding Act ...................................................................... 13
STATISTICS/FORECASTS .................................................................................................... 14
Unemployment at 8.8% in September .................................................................................. 14
Turnover in Industry Up by 4.5% in September .................................................................. 14
Slovenia Spent a Quarter of GDP on Social Protection in 2004 .......................................... 14
FINANCE................................................................................................................................. 15
Euro Campaign Enters Decisive Phase ................................................................................ 15
Survey Finds Ample Opportunities in Developing Financial Markets ................................ 16
Pensions To Rise by 1% in December ................................................................................. 16
NLB Reports Bumper Nine-Month Profit ............................................................................ 17
Banka Koper CEO Awarded for Outstanding Achievements .............................................. 17
Governor Says Central Bank to Remain Important after Euro Switch ................................ 18
Ljubljana Stock Exchange .................................................................................................... 18
Foreign Exchange ................................................................................................................. 19
REGIONAL INFORMATION ................................................................................................ 20
Mura River and Cerknica Lake Included in EU Eco Programme ........................................ 20
New Bridge Opened to Mark Anniversary of Landslide ..................................................... 20
BRANCH INFORMATION .................................................................................................... 22
Slovenian Paper Industry Optimistic About Future ............................................................. 22
Multi-System Engines to Make Rail Traffic with Austria Smooth ...................................... 22
COMPANIES ........................................................................................................................... 24
Bakery Pekarna Blatnik Ups Its Bid for Mlinotest .............................................................. 24
Merger Creates Largest Cosmetics Manufacturer in SE Europe ......................................... 24
Power Utility HSE Opens Subsidiary in Hungary ............................................................... 25
DARS Takes Out EUR 150m Loan for Motorway Construction ........................................ 25
Luka Koper Sings Deal with World's 13th Largest Port ...................................................... 25
Publisher Delo on Track in Q3 ............................................................................................. 26
Mercator Reports 18% Increase in Q3 Revenues ................................................................. 26
Mercator to Consolidate Position of Leading Retailer in SE Europe .................................. 26
Railways to Cut Losses by End of Year, Management Claims ........................................... 27
Krka Reaches EUR 500m in Sales in Q3, Profit Up 28%.................................................... 27
Ex-Telekom Boss Becomes Chief Exec of Belgian Mobile Operator ................................. 28
Merkur Sees Sales Soar, Profits up 4% ................................................................................ 28
Vino Brezice to Get EUR 1.5M in State Aid ....................................................................... 29
Intereuropa Sales Off-target, Profit Buoyant ....................................................................... 29
In a Mature Market, Petrol is Seeking to Expand Southwards ............................................ 29
Zito Ups Its Bid for Mlinotest .............................................................................................. 30
Outgoing CCIS Chairman Proud of What Chamber Has Achieved .................................... 30
SLOVENIA IN BRIEF ............................................................................................................ 32
Retailers Establish Chamber of Commerce ......................................................................... 32
Slovenia, Saudi Arabia to Forge Closer Defence Ties ......................................................... 32
Drnovsek Visits Austrian President, Unveils New Book in Vienna .................................... 32
EU Education Ministers Debate Upgrading of Higher Education ....................................... 32
Employers Endorse Free Movement of Labour at Meeting ................................................. 32
PM Makes Unexpected Call on Slovenian Soldiers in Iraq ................................................. 32
Slovenia and Kuwait Sign Accord on Cooperation in Culture ............................................ 32
Economic and Social Councils Call for Stronger Social Dialogue ...................................... 33
Over 300 Wines at This Year's Slovenian Wine Festival .................................................... 33
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HEADLINES
Central Bank Sees Signs of Slowdown in GDP Growth
At the same time, the central bank notes that inflation remains favourable, as it stood at an
annual rate of 1.6% in October
The rapid pace of Slovenia's economic growth in the first half of the year started to slow down
in the third quarter, the Board of Governors of the Bank of Slovenia concluded on
Wednesday, 15 November based on the available data on industry and trade.
At the same time, the central bank notes that inflation remains favourable, as it stood at an
annual rate of 1.6% in October, mostly as a result of cheaper fuel. This suggests that inflation
will stabilise as forecast.
The central bank's assessment is on par with the projections of the Institute for
Macroeconomic Analysis and Development (IMAD), the government think-tank.
IMAD said that the pace of growth was still brisk but heading for a slowdown early next year
due to lower demand from Germany, Slovenia's main trading partner.
IMAD projects that the economy is on track to expand by 4.7% this year and 4.3% in 2007.
This is precisely the assessment that the Italian banking group UniCredito made, based on
projected strong domestic and external demand.
The Board of Governors also assessed the stability of the bank system, concluding that banks
are at risk from higher interest rates and lower margins due to more expensive loans from
foreign banks.
However, the central bank does not believe any of the potential shocks could jeopardise the
solvency of banks.
September Salaries Up Nearly 4% Y/Y
The average net salary that was paid out to employees in Slovenia in September amounted to
SIT 183,223 (EUR 764,58)
The average net salary that was paid out to employees in Slovenia in September amounted to
SIT 183,223 (EUR 764,58), down 0.9% over August, and up 3.9% year-on-year, according to
the National Statistics Office.
The average gross salary in September totalled SIT 287,557 (EUR 1.200), which is a decrease
of 0.9% over the previous month, and an increase of 3.7% over the same month a year ago.
In real terms, gross salaries increased by 1.2% year-on-year in September.
Amendments to Excise Duties Act Passed
Parliament has passed amendments to the excise duties act which introduce different excise
duties on electricity for households and commercial use and reduce administrative barriers
on the electricity market
Parliament has passed amendments to the excise duties act which introduce different excise
duties on electricity for households and commercial use and reduce administrative barriers on
the electricity market.
Having endorsed the measure by 45 votes against 18 on Thursday, 16 November, the deputies
brought Slovenia's legislation on excise duties fully into line with EU regulations.
According to State Secretary Andrej Sircelj, who is in charge of tax policy, the amended act
reduces the excise duty on commercial use of electricity.
Moreover, Sircelj told MPs that all companies dealing in biofuels would now operate under
the same conditions, while excise duties would only be paid by those suppliers and producers
who provide electricity to end users.
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The 2004 excise duties act stipulates that the excise duty for electricity is set at one euro per
megawatt hour as of 1 January 2007, regardless of whether the power is used by households
or for commercial purposes.
The newly-passed changes retain the excise duty of one euro for non-commercial use, while
reducing the excise duty for commercial use to EUR 0.5. This is in line with the relevant EU
directive.
The amendments also increase excise duties on tobacco products, in particular cigarettes, so
that the tax on cigarettes would be on a par with the European legislation as of next year.
Under the EU regulation, the minimal taxation is EUR 64 per 1,000 cigarettes.
4
INTERNATIONAL COOPERATION
PM Inaugurates Joint Venture in Riyadh, Arrives in Kuwait
Prime Minister Janez Jansa concluded his three-day visit to Saudi Arabia by opening a joint
Saudi-Slovenian electric metres production facility
Prime Minister Janez Jansa concluded his three-day visit to Saudi Arabia by opening a joint
Saudi-Slovenian electric metres production facility, before leaving for Kuwait on Monday, 13
November.
The plant constructed in partnership between Slovenian electronics companies Iskraemeco
and Eti and their Saudi partner MEMF is located in Riyadh's industrial zone.
Opening what is the first Slovenian investment in Saudi Arabia, Jansa was confident that the
successful Saudi-Slovenian business conference would result in greater Slovenian investment
in this country of the Middle East.
A MEMF representative meanwhile said that Slovenian-produced electric metres had since
1996 held a 65% market share in Saudi Arabia, while the new facility would produce metres
for other Middle Eastern countries as well.
Jansa was welcomed to Kuwait by Prime Minister Sheikh Nasir al-Muhammad al-Ahmad alSabah.
The main purpose of the visit, on which Jansa is accompanied by four ministers and a strong
business delegation, is to improve economic cooperation between Slovenia and the two
Middle-Eastern states.
PM Wants Stable Economic and Political Relations with Kuwait
Slovenian Prime Minister Janez Jansa addressed a Slovenian-Kuwaiti business conference in
Kuwait
Slovenian Prime Minister Janez Jansa said Slovenia wanted stable political and economic
cooperation with Kuwait, as he addressed a Slovenian-Kuwaiti business conference in Kuwait
on Tuesday, 14 November.
During the second day of his visit to the Middle Eastern country, Jansa highlighted that
Slovenia was getting ready to hold the EU presidency in 2008 and pointed out that the EU
wanted to ensure energy stability, which is why it works closely with OPEC countries,
including Kuwait.
Jansa, who is accompanied by a strong business delegation, wants to use the visit to improve
economic cooperation between the two countries, as trade between Slovenia and Kuwait
amounted a mere US$ 3m in 2005.
Jansa believes that Slovenia and Kuwait could cooperate in construction, logistics and trade as
well as in investment.
Ali Mohammed Thunayan Al-Ghanim, chairman of the Kuwait Chamber of Commerce and
Industry, assessed that Kuwait and Slovenia share many similarities, including small
geographic size, a similar GDP per capita and their endeavours for world peace.
He also called on Slovenian and Kuwaiti companies to strengthen cooperation and invited
Slovenian companies to take part in Kuwait's planned infrastructure projects.
Prior to the conference, Slovenian and Kuwaiti businessmen signed an agreement on
establishing a Slovenian-Kuwaiti forum to tackle economic, environmental and development
issues.
The forum is presided by Kuwaiti businessman Hussein Al Kharafi, while the body's vicepresident is Janez Skrabec, general manager of Slovenian civil engineering company Riko.
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PM Jansa also met Kuwaiti Emir Sabah al-Ahmad al-Jabir al-Sabah and Jassem Al-Kharafi,
Kuwaiti parliament speaker.
PM Janez Jansa Meets Kuwaiti Emir
The pair discussed cooperation between the EU and the Gulf Cooperation Council and the
situation in the Middle East, especially in Iraq
Prime Minister Janez Jansa met the Emir of Kuwait, Sabah al-Ahmad al-Jabir al-Sabah, on
Tuesday, 14 November as part of his visit to the Gulf state. The pair discussed cooperation
between the EU and the Gulf Cooperation Council and the situation in the Middle East,
especially in Iraq.
It is in the interest of us all that the Iraqi people provide for their own security, which will be
rendered possible only when there are no foreign influences on the country, Jansa told the
press after the meeting.
Jansa and the Emir also touched on the Iranian nuclear programme. The prime minister said a
resolution was also in the interest of Slovenia, which is currently heading the International
Atomic Energy Agency (IAEA).
The Emir expressed Kuwait's concern over the programme, not only because of the potential
for abuse but also because of the environmental risks, Jansa said.
Furthermore, the pair discussed economic cooperation between the two countries. The Emir
assured Jansa that cooperation of Slovenian companies in the infrastructure projects in Kuwait
would be welcome.
The pair also talked about Slovenia's possible cooperation in the reconstruction of Iraq.
Meanwhile, Foreign Minister Dimitrij Rupel met his counterpart Muhammad al-Sabah alSalim al-Sabah. They discussed bilateral relations, the situation in the Arab countries and the
world.
They signed an agreement on cooperation between the two foreign ministries and touched on
the visa regime, discussing ways to facilitate travelling between Slovenia and Kuwait for
tourists and businessmen.
Rupel believes that a solution similar to the one for the citizens of Saudi Arabia, who can
arrange the formalities through the Austrian embassy, could be found.
Slovenia is planning to open a diplomatic mission in the region, however it has not yet
decided what kind of mission this would be, he said.
Rupel also presented Slovenia's preparations for the EU presidency in the first half of 2008
and stressed that an EU-Gulf Cooperation Council summit would take place during Slovenia's
stint.
Bosnia-Herzegovina Calls on Slovenia for Aid in EU Accession
Nebojsa Radmanovic, the president of the Bosnia-Herzegovia tripartite presidency, has asked
Slovenian President Janez Drnovsek for Slovenia's support in the country's EU accession
Nebojsa Radmanovic, the president of the Bosnia-Herzegovia tripartite presidency, has asked
Slovenian President Janez Drnovsek for Slovenia's support in the country's EU accession.
Drnovsek confirmed the support as the pair met in Montenegro on Thursday, 16 November.
Drnovsek and Radmanovic, speaking on the sidelines of the 3rd forum on economic
development of SE Europe, also assessed the cooperation between the two countries as good,
especially in economy.
Drnovsek visited the forum at the invitation of his Montenegrin counterpart Filip Vujanovic.
The event, themed "Competitors and Partners on the Way to European Union", is also
attended by Croatian President Stipe Mesic, Bosnia-Herzegovina Prime Minister Adnan
Terzic and representatives of the states in the region.
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Serbia, Slovenia to Strengthen Ties
Janez Lenarcic, the head of the Government Office for European Affairs (SVEZ), and his
Serbian counterpart Tanja Miscevic agreed on strengthening bilateral ties and defined
possible ways for Slovenia to assist Serbia in its EU accession
Janez Lenarcic, the head of the Government Office for European Affairs (SVEZ), and his
Serbian counterpart Tanja Miscevic agreed on Thursday, 16 November on strengthening
bilateral ties and defined possible ways for Slovenia to assist Serbia in its EU accession.
The pair discussed EU enlargement, European prospects of Western Balkan countries,
Serbia's progress in EU accession and Slovenia's preparations for its stint as EU president in
the first half of 2008, SVEZ wrote in a press release.
During their visit to Ljubljana, the Serbian delegation also met representatives of the Foreign
Ministry, Public Administration Ministry and several government bodies.
SVEZ, the coordinating body for twinning and other EU aid projects moreover offered Serbia
to carry out a seminar on "e-government" that would stress accession.
On Wednesday, 15 November, Miscevic held a lecture at Ljubljana's Faculty of Social
Sciences on Serbia's progress towards the EU.
Slovenia to Open Another Consulate in Israel
Slovenia will open a consulate in Tel Aviv, to be headed by Honorary Consul Eival Giladi
Slovenia will open a consulate in Tel Aviv, to be headed by Honorary Consul Eival Giladi.
The decision was taken at the government session on Thursday, 16 November.
According to the Government PR and Media Office, the decision was prompted by the desire
to further political and strategic dialogue and to deepen the already excellent ties with Israel,
in particular in economy and science.
The government also expects that the opening of the consulate would promote Slovenia in the
central part of Israel.
Slovenia opened a consulate in Haifa in 2002. The honorary consul there, Adi Rosenfeld,
focuses on economic ties with the northern part of the country.
Eival Giladi is a member of the Slovenian-Israeli Business Friendship Association, founded at
the beginning of this year by Slovenia's Ambassador to Israel Iztok Jarc and Honorary Consul
Adi Rosenfeld.
Slovenia to Aid Bulgaria in Acquiring EU Environment Funds
Slovenian Environment and Spatial Planning Minister Janez Podobnik pledged Slovenia's
support to Bulgaria in securing EU environment funds, as he met his Bulgarian host and
counterpart Djevdet Chakurov in Sofia
Slovenian Environment and Spatial Planning Minister Janez Podobnik pledged Slovenia's
support to Bulgaria in securing EU environment funds, as he met his Bulgarian host and
counterpart Djevdet Chakurov in Sofia on Friday, 17 November.
Chakurov expressed Bulgaria's interest in acquiring EU pre-accession assistance for
environment protection projects, prompting Podobnik to invite a Bulgarian delegation to visit
Slovenia to see how such projects are carried out.
The pair also discussed Slovenia's experience in carrying out the European directives on the
protection of environment and waters and the Danube River Protection Convention, Podobnik
told STA after the talks.
Bulgaria is also interested in Slovenia's experience regarding the Natura 2000 protected areas.
Podobnik therefore presented Slovenia's experience in the field.
The pair also concluded that both countries are among more conservative regarding
genetically modified organisms, Podobnik said.
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The ministers also agreed that several Bulgarian experts in environment protection,
genetically modified organisms and water protection would visit Slovenia in the following
months.
8
EUROPEAN UNION
Slovenian, Portuguese Officials Debate EU Presidency Preparations
The preparations for the rotating presidencies of the EU that Portugal and Slovenia will hold
successively from the second half of 2007 dominated talks between Foreign Ministry State
Secretary Bozo Cerar and Manuel Lobo Antunes, European affairs state secretary at the
Portuguese Foreign Ministry
The preparations for the rotating presidencies of the EU that Portugal and Slovenia will hold
successively from the second half of 2007 dominated talks between Foreign Ministry State
Secretary Bozo Cerar and Manuel Lobo Antunes, European affairs state secretary at the
Portuguese Foreign Ministry on Tuesday, 14 November.
Cerar and Antunes expressed willingness to continue cooperating in preparations for their
countries' presidencies. They also discussed the future of the EU and enlargement to the
Western Balkans, the Foreign Ministry said in a press release.
The pair agreed that the EU membership of countries of the Western Balkans needs to remain
high on the 25-nation bloc's agenda. The EU must honour its commitments to these countries.
Cerar said this would be one of the priorities of Slovenia's stint as EU president. He also said
that Serbia should be given concrete incentives on its path towards the EU and NATO.
The preparations for the successive EU presidencies are carried out in a troika with Germany,
which is next in line in the first half of 2007. A draft programme for the 18-month period has
been finalised and is awaiting confirmation by the EU's General Affairs and External
Relations Council in December.
Slovenia Welcomes Confirmation of EU Services Directive
For the trade unions, the most important aspect of the directive is that the "country of origin"
principle, the most controversial and beleaguered provision, had been thrown out
All stakeholders in Slovenia have welcomed the European Parliament's confirmation on
Wednesday, 15 November of the services directive, a set of measures designed to make it
easier for service providers to do business in other EU countries.
For the trade unions, the most important aspect of the directive is that the "country of origin"
principle, the most controversial and beleaguered provision, had been thrown out.
That way the directive preserves collective agreements as well as the attained social standards
of Slovenian workers, Dusan Semolic of the Association of Free Trade Unions of Slovenia
(ZSSS) told STA.
Semolic said that the main benefits of the new legislation would be cheaper services, but the
downside is that many providers would be ruined due to fiercer competition.
The Chamber of Craft Industries (OZS), had pushed for the implementation of the country of
origin principle, but it is still pleased with the outcome.
OZS secretary general Viljem Psenicny told STA that the directive would be "a step towards a
more competitive Europe", although Slovenian providers have not had many problems in
offering their services in Europe.
The Economics Ministry also voiced satisfaction with the directive, with State Secretary
Matjaz Logar saying that this was the maximum that the member states could agree on this
summer.
The directive was adopted with the yes-votes of all seven Slovenian Members of the
European Parliament.
9
Following the vote, the legislation still has to be approved by the member states. This is
expected before the end of the year whereupon the member states will have three years to
transpose it into their national legislation.
Speakers Agree to Push on With Euroregion Plans
Speakers of several regional parliaments from Italy, Croatia and Hungary as well as
Slovenian Parliament Speaker France Cukjati agreed to push ahead with the process of
creating an alliance of regions
Speakers of several regional parliaments from Italy, Croatia and Hungary as well as Slovenian
Parliament Speaker France Cukjati agreed on Wednesday, 15 November to push ahead with
the process of creating an alliance of regions.
The participants issued a joint statement following their meeting in Slovenia's parliament that
in the future they will strive for such forms of cooperation between the regions that will
contribute to sustainable economic and social development.
Their talks focused on plans to build the "Euroregion" as an upgrade of the current crossborder cooperation.
Today we adopted guidelines for the future, Cukjati said at a press conference that followed
the meeting.
Speaker of the Carinthian provincial parliament Joerg Freunschlag stressed that the regions
should tackle issues on their own, especially now that the EU is in crisis.
Deputy Speaker of the Veneto regional parliament Carlo Alberto Tesserin said that the
participants of the meeting established that in tourism, these regions can offer to the world
things that others do not have.
EU offers great possibilities and it is politicians' responsibility to turn this to the advantage of
people, said the speaker of the Hungarian Vas and Zala regional parliament Ferenc Kovacs.
Speaker of the Croatian Istria regional parliament Anton Perusko is convinced that the
Euroregion has a lot to offer, while his counterpart from the Primorsko-Gorjanska region
Marino Dumanic believes that the borders have to be open and should connect and not divide.
Also present at the meeting was the speaker of the Styrian regional parliament Barbara Gross
and the speaker of the Friuli-Venezia Giulia regional parliament Alessandro Tesini.
The next meeting of the regional parliament speakers will take place in Carinthia in May
2007.
Schengen Delay Prompts Cukjati and Szili to Write to EU
France Cukjati, the speaker of the National Assembly, and his Hungarian counterpart Katalin
Szili have addressed a joint letter to top EU officials complaining about the possibility of a
delay in the enlargement of the EU's Schengen border-free zone
France Cukjati, the speaker of the National Assembly, and his Hungarian counterpart Katalin
Szili have addressed a joint letter to top EU officials complaining about the possibility of a
delay in the enlargement of the EU's Schengen border-free zone.
According to a press release from the parliament on Thursday, 16 November, Cukjati and
Szili sent the letter to President of the European Parliament Josep Borrell, President of
European Commission Jose Manuel Barroso and Finnish Prime Minister Matti Vanhanen,
whose country currently holds the rotating EU presidency.
The target date of October 2007 for the inclusion of new members into the Schengen zone had
been set and subsequently confirmed by the leaders of the EU member states in the European
Council, Cukjati and Szili point out in the letter sent on Tuesday, 14 November.
"Simple technical difficulties cannot be a reason for postponement," the pair said in the letter,
emphasising that the expansion of the Schengen area is primarily a political decision. They
added that Slovenia and Hungary have met all criteria for joining the Schengen zone.
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Cukjati and Szili went on to say that a postponement of the Schengen zone expansion could
cause a deep crisis in confidence over the EU constitution among the members that joined the
bloc in 2004.
Slovenia Not Mulling Closing Labour Market to EU Newcomers
Slovenia is not considering closing its labour market to workers from Bulgaria and Romania
once these countries join the EU in 2007
Slovenia is not considering closing its labour market to workers from Bulgaria and Romania
once these countries join the EU in 2007. "On the contrary, Slovenia is making efforts to
convince the EU countries which have restricted the flow of labour to lift or curb the
restrictions," Prime Minister Janez Jansa told the press on Thursday, 16 November.
Most members of the EU-15 club put in place restrictions on workers from the eight Central
and Eastern European newcomers that joined the EU in 2004, but the barriers are being
gradually taken down.
With the arrival of two poor countries to the 25-nation bloc, it is expected that many of the old
member states will put in place restrictions for them too.
Even Great Britain and Ireland, which were among only three countries that had fully opened
up their labour markets to the newcomers in 2004, have decided to limit access for Bulgarians
and Romanians.
Slovenia Wins Eurostat Approval for Two Regions Reclassification
Slovenia has won approval from the European statistical office, Eurostat, for reclassification
as two cohesion regions
Slovenia has won approval from the European statistical office, Eurostat, for reclassification
as two cohesion regions.
The Statistical Programming Board at Eurostat cleared on Thursday, 16 November Slovenia's
request for being split into two regions, the Slovenian Statistical Office said on Thursday, 16
November.
The procedure of approving Slovenia's request is therefore expected to be wrapped up before
the end of the year, the office added.
Based on the approval from Eurostat, the European Commission is now expected to prepare
an official proposal and forward it to the member states for confirmation.
The approval comes almost exactly a year after Slovenia submitted the request, based on the
2005 act on the promotion of balanced regional development, to the European Commission.
Slovenia asked for the change in its NUTS 2 status from one to two regions (east and west) in
a bid to improve its position for receiving core development aid from the EU in the future.
The proposal for reclassification was drafted at a time of deadlock in talks on the 2007-2013
EU spending plan, which coupled with Slovenia's current status as one region and its growing
GDP threatened to make it illegible for a bulk of EU development aid in the future.
The decree on reclassification is expected to enter into force the second year after its
adoption, i.e. on 1 January 2008.
This means that it will not be valid for the 2007-2013 EU budget period, during which
Slovenia will still be classified as one region, but will continue to be entitled to Level 1
development aid since the EU managed to break its budget deadlock before the end of 2005.
Eurobarometer: Slovenians True Euro Connoisseurs
Almost all Slovenians have already seen euro banknotes or coins and 85% have already used
them, which is the highest percentage among EU newcomers
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Almost all Slovenians have already seen euro banknotes or coins and 85% have already used
them, which is the highest percentage among EU newcomers, according to the results of the
latest Eurobarometer survey.
The survey showed that Slovenians are also the least attached to their national currency, with
72% expressing satisfaction or even extreme satisfaction with the changeover.
A great majority of Slovenians, 83%, believe they are well informed about the introduction of
the euro, which is to take place on 1 January 2007. About a sixth believe they need more
information, with the majority wishing to get a hold of this information as soon as possible.
The opinion rates regarding the level of knowledge did however not match the actual
knowledge demonstrated by those surveyed. Only 44% knew how many countries already
belong to the eurozone and only 45% were able to answer correctly questions concerning the
design of euro banknotes.
The survey thus established that Slovenians regard the date of the changeover and the
exchange rate to be the most important pieces of information forming the criteria for their
knowledge about the euro. Less importance is attached to broader knowledge about the
European economic and monetary union.
Among the possible positive effects of the euro, Slovenians like to highlight the expectation
that the euro will strengthen the influence of Europe in the world. They also believe that
having euros in their hands will make people feel more European and many also that the euro
will protect Slovenia against the impacts of international crises.
Obviously, Slovenians are most afraid of unjustified price hikes, with many also expecting an
increase in inflation.
Only few on the other hand expect to be personally affected or that Slovenia's identity will
suffer because of the new currency. Also few in number are those believing that the country
would lose control of its economic policies.
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LEGISLATION
Parliament Passes Municipality Funding Act
According to the government, the act introduces fairer local funding
Parliament passed the municipality funding act in a 45 to 12 vote at the close of its
extraordinary session on Friday, 17 November. According to the government, the act
introduces fairer local funding.
According to Local Self-Government and Regional Policy Minister Ivan Zagar, the new law
brings equitable financing and greater autonomy for municipalities.
According to Zagar, such goals can only be achieved if the municipalities' tasks are balanced
with their financial sources and the municipalities are given greater autonomy in acquiring
and spending the funds.
MPs also passed a ruling coalition-sponsored amendment that will secure additional EUR
885m for municipalities from the 2007 budget and EUR 922m from the 2008 budget.
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STATISTICS/FORECASTS
Unemployment at 8.8% in September
The registered unemployment rate averaged 9.7% in the first three quarters of this year
The registered unemployment rate in Slovenia stood at 8.8% in September, down 0.3
percentage points over August, according to the latest data from the Statistics Office. The
registered unemployment rate averaged 9.7% in the first three quarters of this year.
A total of 80,224 people were registered as unemployed in September, 3.4% fewer than the
previous month. The unemployment rate among women was 10.9%; among men it stood at
7.1%, the data shows.
Slovenia's active population numbered 909,763 in September, with 829,539 of those
registered as employed, an increase of 0.5% over August and up 1.6% year-on-year.
According to the Statistics Office, 83,452 persons of the total number of employed were selfemployed.
Around half of those employed in September were working in the services sector, followed by
industry (38.1%), while agriculture came last with 4.7%.
Turnover in Industry Up by 4.5% in September
Total turnover in industry in September was up 4.5% in real terms over the same period last
year
Total turnover in industry in September was up 4.5% in real terms over the same period last
year. The turnover from sales on the domestic market increased by 5.9%, and by 3.7% on
foreign markets, reported the National Statistics Office.
Compared to September last year, turnover increased in all three main industrial groupings:
8.2% in capital goods industries, 4.9% in intermediate goods industries, and 0.9% in
consumer goods industries.
The value of all orders received in September increased 1.3% year-on-year, but it was by
2.4% lower than in the previous month.
The value of new orders received by industrial enterprises in the first nine months was 5.9%
higher than in the same period last year.
On the yearly basis, new orders on domestic markets increased by 7.7%, and by 5.4% on
foreign markets.
Slovenia Spent a Quarter of GDP on Social Protection in 2004
Slovenia spent SIT 1492.5bn (EUR 6.228bn) on social protection in 2004
Slovenia spent SIT 1492.5bn (EUR 6.228bn) on social protection in 2004, which is almost a
fourth of that-year's GDP, the National Statistics Office has reported. Compared with 2003,
the figure increased by 6.8% and compared to 1996 by 128.9%.
In real terms, in 2004 all expenses related to social protection in Slovenia were up 3.1% over
the previous year and 32.8% higher than in 1996.
In 2004, the share of GDP spent on social protection was 24.4%, 0.2 percentage points less
than 2003. The bulk, or 43%, went for the elderly, 32.7% for health, 8.6% for families and
children and 8.1% for the disabled.
Social protection programmes in Slovenia are financed in 70% from social contributions, with
27% of these accounted for by employers in 2004. Almost 40% of all social protection costs
that year were carried from the address of contributions from insured persons, the rest by the
state and other contributions.
14
FINANCE
Euro Campaign Enters Decisive Phase
With a month and a half to go before Slovenia switches to the euro, the government and the
central bank stepped up the campaign to inform the citizens about the new currency
With a month and a half to go before Slovenia switches to the euro, the government and the
central bank stepped up the campaign to inform the citizens about the new currency. The first
of three TV ads will be broadcast prior to tonight's main news programme on the public
broadcaster and the largest commercial TV station.
The campaign on TV Slovenija and POP TV follows advertisements in the press and radio ads
launched on Monday, 13 November. Moreover, households across the country will receive
information leaflets and euro calculators at the beginning of next week.
The government and the Bank of Slovenia launched the campaign headlined "Counting on
Euro?" in a bid to send three messages to the consumers, the head of the Government PR and
Media Office, told the press on Tuesday, 14 November.
According to Krajc, the message is that euro coins are not "small change" as they are worth
more than tolar coins; secondly, that consumers should put the money they keep at home to
banks, which will change it to euros free of charge; and thirdly, that they should keep a close
eye on prices and warn of unjustified rounding up of prices.
Krajc, who spoke on the sidelines of the annual meeting of communications directors for the
euro, said the same message was communicated by the ads published by three TV channels,
16 radio stations and 35 printed media.
Ads will also be screened at cinemas, while a web game will be launched next week in which
participants will be required to write down as speedily as possible the euro price of a pizza.
According to Krajc, just over half of the EUR 480,000 budget for the campaign will be spent
on TV advertising. He said the PR and Media Office earmarked a total of SIT 200m (EUR
834,585) for the euro project in two years, while the European Commission contributed EUR
800,000.
According to Gordana Pipan, the spokesperson for the Bank of Slovenia, the central bank
allocated some SIT 100m (EUR 417,293) for the leaflets and information campaign, and as
much for euro calculators.
The communication activities launched in March will continue with a brochure entitled
"Ready for the Euro?", a project of the Bank of Slovenia and the European Central Bank,
which is to be distributed to households.
Krajc added that the last brochure issued in cooperation between the government and the
central bank would come out in December to highlight the main details of the changeover.
The official also told his counterparts gathered in Ljubljana that the main event upon the
introduction of the single European currency at the beginning of 2007 was still being
prepared. It was intentionally not planned for New Year's holidays, but for 15 January, when
the dual circulation runs out.
According to Krajc, the main event will be an exhibition on currencies used on the Slovenian
territory. The European and Slovenian central banks will meanwhile hold a euro conference.
On 1 December, laser projections will be launched in the centre of Ljubljana to highlight
major data regarding the new currency. The display will be visible from the Triple Bridge,
one of the busiest spots in town.
This is the first time the session of EU government and central bank officials responsible for
communications on the euro is being held outside of Brussels.
15
The meeting was also addressed by Finance Minister Andrej Bajuk, who said that the path
towards the euro required strong political will and cooperation among social partners.
While the Finance Ministry shares consumers' concern about price hikes related to the euro
changeover, Bajuk said that apart from the administrative measures it launched, the ministry
counted on the power of the media.
He moreover pointed out that consumers in particular can "vote with their feet" by not making
their purchases where they noticed unjustified price hikes.
Survey Finds Ample Opportunities in Developing Financial Markets
A survey has found that the fast growing financial sectors in the developing economies of
Southeast Europe and the former Soviet Union offer ample opportunities for companies from
Slovenia and the EU
A survey has found that the fast growing financial sectors in the developing economies of
Southeast Europe and the former Soviet Union offer ample opportunities for companies from
Slovenia and the EU. If the countries in the region follow the social and economic path that
the new EU members have taken, they will offer similar growth opportunities.
The survey, carried out by a group of MA students at the Ljubljana Faculty of Economics
under the guidance of professor Dusan Mramor, was presented on Thursday, 16 November at
a conference on the development of the financial and real sectors in developing economies.
Mramor, a former finance minister, said the results suggest that there are opportunities in
these markets which Slovenian companies have so far failed to seize.
While they have been trying in the capital markets and with mutual funds, they have been
having serious problems in breaking through to the banking and insurance markets.
According to Mramor, this is largely due to a lack of adequate capital, so it would make sense
for the companies to pool their resources.
The survey projects that loans to companies and households as well as investment banking
would grow faster than in the EU, provided that the developing economies follow the path of
the EU newcomers.
Russia is highlighted as the most attractive economy: it has the biggest banking market and
there are plenty of opportunities despite the dominance of domestic banks.
Serbia, Ukraine and Kazakhstan top the list alongside Russia, while Croatia, where the market
is saturated, and Moldova, which lags behind in economic reforms, are seen as the least
attractive destinations.
The survey projects above-average returns from mutual funds in all countries in the two
regions bar Bosnia-Herzegovina, Macedonia and Moldova. Serbia, Romania and Ukraine are
underlined as the main potential goldmines.
Solid growth rates are also expected in insurance, where Romania, Russia and Kazakhstan are
seen as the most prospective markets.
According to the authors of the survey, international conglomerates are already present here
so the Slovenian financial sector would have to consolidate if it was to play a significant role
there.
The Portoroz Business Conference, organised by the business daily Finance, featured over
100 politicians and businessmen from the EU and developing economies. In its eighth running
this year, it was focusing on Russia, Ukraine, Kazakhstan and Kosovo.
Pensions To Rise by 1% in December
The decision for the raise was put forward by the ZPIZ management and confirmed at a
session of the governing board of the institute
Slovenian pensioners will have something to smile about ahead of the holiday season, as the
Pension and Disability Institute (ZPIS) decided to raise pensions by 1% as of next month.
16
The decision for the raise was put forward by the ZPIZ management and confirmed at a
session of the governing board of the institute on Thursday, 16 November.
Moreover, assistant director of ZPIZ Joze Kuhelj announced pensioners would also be
receiving in December a lump-sum payment to compensate for the fact that the raise in
pensions comes at the end of the year.
This is in line with pension indexation regulations, which state that pensions should rise by
the same amount as wages in a given year.
Kuhelj added that the pension purse could cope the additional SIT 733m (EUR 3m) that
would be paid out each month as a result of higher pensions.
The base pension following the indexation will be SIT 107,862 (EUR 450), added Kuhelj.
NLB Reports Bumper Nine-Month Profit
Slovenia's largest banking group, NLB, has reported a net profit of SIT 28.8bn (EUR 120.2m)
for the first nine months of this year
Slovenia's largest banking group, NLB, has reported a net profit of SIT 28.8bn (EUR 120.2m)
for the first nine months of this year, a 23% increase on last year. Meeting on Thursday, 16
November, the bank's supervisory board said it was pleased with the results.
According to a press release from the bank, the group's profit rose on the back of growth in all
areas of operations.
Along with the nine-month results, the supervisory board also approved the group's 20072009 business plan. The document puts organic growth and expansion of services among its
key priorities aimed at keeping the bank firmly in top spot on the Slovenian market.
The group, which operates in 16 countries, generating total annual revenues in excess of EUR
15bn, plans to increase profitability and cost efficiency in the coming years. Further
consolidation of the NLB group is also planned.
The supervisors also reviewed the bank's preparations for the euro, concluding that things
were proceeding as planned.
Banka Koper CEO Awarded for Outstanding Achievements
Vojko Cok, the chairman of the Banka Koper bank, was awarded for outstanding
achievements in business by the Finance business daily in Protoroz
Vojko Cok, the chairman of the Banka Koper bank, was awarded for outstanding
achievements in business by the Finance business daily in Portoroz on Thursday, 16
November.
Cok received the award, given out by the country's leading financial newspaper, for playing
far more than just the role of the chief exec.
"Without him, Banka Koper, the Slovenian banking sector and the Primorsko region would
not be where they are now," the organisers said at a business conference.
Cok, who has been at the bank's helm since 1982, said that he did not expect the award, but is
proud of it.
After thanking his co-workers and business partners, Cok also said that he saw the award as a
"recognition of Slovenian banking which has maintain its credibility in the future".
Janez Prasnikar of the Ljubljana Faculty of Economy said that under Cok's leadership the
bank had to help many companies that were hard hit by Slovenia's transition into a market
economy in the early 1990s.
Cok could have closed down the companies, but he did not. He helped them back into the
black and saved many a person from misfortune, Prasnikar added.
"Cok managed to find harmony between the bank's high economic goals and the
environment's sustainable development...he is undoubtedly a role model for all leaders," he
explained.
17
The award has been conferred by the business daily since 1999 to individuals or organisations
that have made a difference on the Slovenian business scene, and have at the same time
enhanced the prosperity of the entire society.
Cok has joined the likes of pharma company Krka CEO Joze Colaric, the speaker of the first
democratically elected parliament France Bucar, Slovenia's Former President Milan Kucan,
and Joze Stanic, the former CEO of home appliances maker Gorenje, and others.
Governor Says Central Bank to Remain Important after Euro Switch
It will continue to control domestic banks and have to develop additional analytical functions
Mitja Gaspari, governor of the Slovenian central bank, said that, contrary to prevailing
opinion, the institution will remain important after Slovenia's 1 January 2007 adoption of the
euro.
It will continue to control domestic banks and have to develop additional analytical functions,
Gaspari told the participants of a business conference in Portoroz on Friday, 17 November.
"The Bank of Slovenia will lose its decision-making ability on interest rates and exchange
policy", Gaspari added.
"It is unrealistic to expect that the scope of activities of the bank would lessen in the future,
but it is highly likely that it would need a greater number of trained personnel," he explained.
According to Gaspari, the central bank will have to additionally develop statistics and
research in order to give quality information to the governor of the bank at the meetings of EU
central bank governors.
Increasing in importance will also be the management of foreign currency reserves. After a
part of the reserves (some EUR 200m) are transferred to ECB foreign currency reserves, the
remainder will be used for financial investment.
These investments would also earn the majority of funds needed for the operation of the
institution, the governor said.
Also required are changes to the act on the central bank, which has to be written so as to
prevent any possibility of state bodies to influence the decisions of the central bank.
Ljubljana Stock Exchange
Anticipation of business results of companies in the first nine months of 2006 caused a slowdown of trading at the Ljubljana Stock Exchange (LJSE), with the main market SBI 20 index
adding 14.04 points to 5,894.19 on the week
Anticipation of business results of companies in the first nine months of 2006 caused a slowdown of trading at the Ljubljana Stock Exchange (LJSE), with the main market SBI 20 index
adding 14.04 points to 5,894.19 on the week. The SBI TOP index of the six largest blue chips
meanwhile shed 4.43 points to 1,394.54.
In a week of mixed trading, the brokers concluded deals worth a meagre SIT 6.83bn (EUR
28.5m), including SIT 2.49bn (EUR 10.39m) in block trade.
Pharma company Krka traditionally remained the most coveted share, accounting for SIT
1.4bn (EUR 5.84m) in volumes. It shed 0.94% to SIT 184,141 (EUR 768.41), despite a late
rally following the publication of upbeat business results.
Krka reported sales revenues of SIT 120bn (EUR 500m) for the first three quarters of the
year, up 23% on the same period last year. The group's net profit was up 28% at SIT 19bn
(EUR 79.3m) in the same period.
A similar fate awaited energy company Petrol, despite posting bumper profits for the first
three quarters of the year on Friday, 17 November. The share lost 1.03% to SIT 112,822
(EUR 470.8) on deals worth SIT 818m (EUR 3.41m), including block trade.
Petrol's sales expanded by 12% to SIT 342bn (EUR 1.43bn), with profit soaring by 30% to
SIT 9.5bn (EUR 39.6m) in the January-September period.
18
Retailer Mercator which published its upbeat results on Friday, 17 November meanwhile
soared 2.87% to SIT 45,956 (EUR 191.77) on deals worth SIT 358m (EUR 1.49m), including
block trade. Mercator posted SIT 351.3bn (EUR 1.465bn) in net sales revenues, up 18% on
the same period in 2005.
The bidding war between family-owned Pekarna Blatnik bakery and bread and pasty producer
Mlinotest, meanwhile pushed the shares of the acquisition target, bread and pasta maker Zito,
35.6% higher on the week.
The loser of the week was meanwhile port operator Luka Koper, which shed 1.85% to SIT
9,243 (EUR 38.57) on meagre volumes.
Investment funds traded mainly in the black, pushing the PIX investment fund index 31.31
points higher to 4,917.49.
The BIO bond index shed 0.76 points to 118.88.
Foreign Exchange
Mean exchange rate of the Bank of Slovenia
Euro (EUR) - SIT 239.60 (-0.01)
US dollar (USD) - SIT 191.10 (+5.04)
Swiss franc (CHF) - SIT 150.50 (+0.12)
British pound (GBP) - SIT 357.29 (+0.89)
19
REGIONAL INFORMATION
Mura River and Cerknica Lake Included in EU Eco Programme
The Ministry of Environment and Spatial Planning presented two new projects to be included
next year in the LIFE - Nature programme, which distributes EU subsidies for environmental
protection projects
The Ministry of Environment and Spatial Planning presented on Wednesday, 15 November
two new projects to be included next year in the LIFE - Nature programme, which distributes
EU subsidies for environmental protection projects. The projects involving the protection of
biotic diversity of the river Mura and the vanishing Cerknica Lake are estimated at over EUR
3.8m.
The Mura project is designed to preserve the existing natural resources and biodiversity,
restore the importance of the river channel, and ensure adequate ecological conditions for
wetlands, said Lidija Globevnik of the Slovenian Institute for Water.
The activities will be focused on the protection of habitats and ten species of birds. The
project is valued at nearly EUR 2m, of which nearly half will be provided by the EU.
The aim of the project on the vanishing Cerknica lake is, according to Leon Kebet from the
Notranjsko Regional Park, to preserve the lake and endangered species native to it. This
includes providing the right conditions for the nesting of endangered bird species as well as
amphibian life.
The value of the Cerknica lake project, which also includes a public awareness campaign, is
estimated at EUR 1.8m, of which EUR 1.3m will be secured by the EU.
Slovenia has so far carried out 11 projects sponsored by the LIFE programme, whose aim is to
promote the EU directive on birds and habitats, the head of the LIFE office at the European
Commission, Phillip Owen, said.
Some 23% of Slovenia's territory has been earmarked for the protection of birds and as much
as 31.4% for the protection of rare species and habitats. Slovenia is the leader in the EU in
terms of the share of its territory earmarked as protected areas for birds, Owen said.
New Bridge Opened to Mark Anniversary of Landslide
A new bridge across the Predelica creek was opened on 17 November, marking one of the key
parts of the reconstruction after the catastrophic landslide that buried the village of Log pod
Mangartom in NW Slovenia six years ago
A new bridge across the Predelica creek was opened on Friday, 17 November, marking one of
the key parts of the reconstruction after the catastrophic landslide that buried the village of
Log pod Mangartom in NW Slovenia six years ago.
Friday, 17 November marks exactly six years since the landslide that swept the village,
destroying ten houses and killing seven people. The landslide also destroyed the bridge across
the Predelica creek. Traffic has since been forced to use a pontoon bridge that was put up in
the aftermath of the disaster.
In the meantime, a new 50-metre bridge, standing 10 metres above the Predelica, was
constructed. The new bridge uses a design to safeguard the foundations from new landslides.
The opening of the new bridge worth SIT 365m (EUR 1.52m) also marks the start of the final
phase of efforts to revive the village.
Danijel Krivec, the mayor of Bovec municipality where the village and bridge are located
labelled the event as the beginning of a new investment phase. "There is a great future ahead
for the valley", added Krivec.
20
By the middle of next year, the village will get new water distribution and sewage systems;
other public utility infrastructure; a waste treatment plant and a safety wall, thereby
concluding the main part of the reconstruction.
About twenty five housing, business and other buildings were torn down during the
reconstruction. According to Stanislav Begus, the head of a government office for
reconstruction, all fifteen new houses are going to be finished by the second half of 2007.
The project of building new houses and infrastructure will cost SIT 1.25bn (EUR 5.2m), of
which SIT 1bn (EUR 4.17m) will be provided by the government.
The rebuilding of the complete area hit by the landslide is going to take even more time and
money. By the year 2010, when it is due to be completed, the total costs will rise to about SIT
6.5bn (EUR 27.1m).
21
BRANCH INFORMATION
Slovenian Paper Industry Optimistic About Future
The paper industry in Slovenia is relatively small, as it accounts for only 1.3% of the economy
and 3.5% percent of total industrial output
The Slovenian pulp and paper industry looks to have a bright future, officials told an industry
meeting in the lakeside resort of Bled.
"Although rising costs have in the past two years been putting pressure on the industry...this
year's operations will be roughly equal to that of last year," head of the Association of the
Slovenian Pulp and Paper Industry Branko Rozic told STA on the sidelines of the meeting.
According to Rozic, the fact that the industry has managed to keep operations stable in spite
of rising energy, logistics and labour costs, is an achievement in itself.
The industry meeting was accompanied by a traditional annual symposium of the Slovenian
Association of Pulp and Paper Engineers and Technicians (DITP). The meeting examined the
advantages of using paper products over plastics as well as the position of the paper industry
in Europe.
The event is an opportunity to exchange professional and business ideas. Rozic said that
innovation was playing an important part in the professional aspects of the debate.
"This aspect is very important because the industry must continually upgrade its technology"
if it wants to keep up with global competition, he added.
Another key aim of the event is to establish connections between the companies.
"Cooperation between companies has been on the decline lately, which makes this event even
more relevant," Bogdan Lampic, head of DITP pointed out. He also said cooperation in
technology was crucial for staying competitive.
While Rozic welcomes competition, he points out that producers from China and other far
east countries have an unfair advantage due to their resources, which are inaccessible to
Europe. He warned that subsequently Europe would soon have to face the might of Chinese
paper producers.
However, he stresses that the industry does not expect help from the state. The industry has
not been receiving any subsidies and does not expect to get any in the future, Rozic said.
According to him, the paper industry in Slovenia is relatively small, as it accounts for only
1.3% of the economy and 3.5% percent of total industrial output.
Multi-System Engines to Make Rail Traffic with Austria Smooth
Railway traffic between Slovenia and Austria is expected to run smoothly after electric multisystem engines are put into service on 10 December
Railway traffic between Slovenia and Austria is expected to run smoothly after electric multisystem engines are put into service on 10 December. As this type of engine is compatible with
most of Europe's diverse rail networks, engine switching will be rendered unnecessary.
According to a press release from the Slovenian Railways on Friday, 17 November, the
interoperability agreement was signed in Austria's Villach on Thursday, 16 November by
Valter Oblak, the Slovenian Railways towing executive director, and his Austrian counterpart
Herwig Wiltberger.
Multi-system engines will be running most of goods trains operating between the stations of
Zalog, in Slovenia, and Villach, in Austria, a pair of trains operating between the Slovenian
port town of Koper and Linz and six pairs of express trains operating between Villach and
Dobova, in the east of Slovenia.
22
In the following period, Slovenian engines are expected to cover more than 305,000
kilometres on Austrian tracks, while Austrian engines are to make some 220,000 kilometres,
according to the Slovenian Railways.
The operator says the new deal will reduce the stopping time on border stations and the
duration of rides as a whole. This should in turn enable the two companies to cut costs and
make them more competitive.
According to Oblak, the border stops will now be made only for the necessary border
procedures, while the enforcement of the Schengen border regime will reduce the stopping
time on the border from about one hour to a mere three to five minutes.
Slovenian Railways plan to introduce multi-system engines to the Spielfeld border crossing to
the east as well as expand cooperation with Italian railways.
Interoperable engines of both railway companies have been operating between Slovenia and
Italy since 2003, but Slovenia plans to phase them out in favour of more modern multi-system
engines.
23
COMPANIES
Bakery Pekarna Blatnik Ups Its Bid for Mlinotest
Pekarna Blatnik, the family-owned bakery, has increased its bid to acquire bread and pasta
maker Mlinotest, offering SIT 1,690 (EUR 7.05) per share
Pekarna Blatnik, the family-owned bakery, has increased its bid to acquire bread and pasta
maker Mlinotest, offering SIT 1,690 (EUR 7.05) per share, which is SIT 90 (EUR 0.38) more
than in the initial bid.
In the offer published on Monday, 13 November the Velike Lasce-based bakery lowered the
takeover target to 50% plus one share, or a total of at least 1,194,589 Mlinotest shares. The
new deadline of the bid is 4 December.
Pekarna Blatnik says its intention is to secure additional production facilities through the
takeover, and it believes that Mlinotest of Ajdovscina is the most complimentary industry to
the company.
If it succeeds in acquiring Mlinotest, Pekarna Blatnik will seek to make full use of the now
free production capacities in the Mlinotest bakery in Ajdovscina. In this way, Blatnik plans to
expand the range of products, increase profitability and thus pave the way to new jobs, the
bakery said in a press release on Monday, 13 November.
Pekarna Blatnik has already received approval for the acquisition from the Competition
Protection Office. Its rival for the takeover of Mlinotest, Zito, offered SIT 1,680 (EUR 7.01)
per share in late October.
Zito's announcement of the takeover spurred Blatnik to publish an intent for the acquisition of
Zito, the company several times its size. Blatnik said one of the main reasons for the move
was to defend against a powerful concentration that a possible merger between Zito and
Mlinotest would represent for the home bread industry.
Zito, which already holds a 17.04% stake in Mlinotest through its subsidiary Pekarna
Vrhnika, said it would consider its bid successful if acquiring at least 33% of the takeover
target.
Nevertheless, given that Zito is a takeover target itself, the Securities Market Agency (ATVP)
ordered the company on 26 October to call within three days a shareholders' meeting to get an
approval for the acquisition of Mlinotest. Zito called a shareholders' meeting for 21
November.
Merger Creates Largest Cosmetics Manufacturer in SE Europe
Cosmetics producer Ilirija acquired pharma company Lek's cosmetics units Lek Kozmetika
Cosmetics producer Ilirija acquired pharma company Lek's cosmetics units Lek Kozmetika,
Lek said on Monday, 13 November. The daily Finance wrote on its website that the
acquisition created the largest cosmetics manufacturer in SE Europe.
According to Lek, owned by Sandoz, the generics unit of Swiss pharma giant Novartis, the
production of cosmetics products in Lek Kozmetika's Lendava (NE) facility will continue.
Lek moreover believes that it has found a "prospective strategic partner" for its cosmetics
arm.
Lek Kozmetika has operated as Lek's subsidiary since 2002.
Ilirija posted a loss of SIT 115m (EUR 480,000) in 2005, on sales revenues of SIT 3.58bn
(EUR 15m).
Lek Kozmetika also ended 2005 in the red, with losses amounting to SIT 15.81m (EUR
66,000) on revenues of SIT 2.86bn (EUR 12m).
24
Power Utility HSE Opens Subsidiary in Hungary
HSE Hungary will operate on a large and transparent market, something that is not the case
for other countries in the region
Slovenia's leading power producer HSE opened a subsidiary in Budapest. HSE Hungary will
operate on a large and transparent market, something that is not the case for other countries in
the region, the company said in a press release on Monday, 13 November.
The subsidiary will moreover facilitate links with the markets of central and eastern Europe,
especially Poland, the Czech Republic and Slovakia, increasing HSE's flexibility and scope of
trading with electricity.
According to HSE's press release, a high-voltage link will soon be established between
Slovenia and Hungary, while HSE Hungary will buy and sell electricity on the organised
market.
Indeed, through its Hungarian subsidiary HSE already takes part in auctions on trans-border
electricity transmission.
HSE's foreign network currently includes the Italian subsidiary HSE Italia, HSE Balkan
Energy in Serbia, HSE Hungary and a subsidiary in the Czech Republic. A subsidiary is
shortly to be opened in Romania as well, the press release also reads.
DARS Takes Out EUR 150m Loan for Motorway Construction
The company intends to use the money to finance the construction of motorway sections in the
national motorway programme and for repairing several existing sections
The Slovenian Motorway Company (DARS) signed on Monday, 13 November a loan contract
worth EUR 150m with German Deutsche Pfandbriefbank (DEPFA). The company intends to
use the money to finance the construction of motorway sections in the national motorway
programme and for repairing several existing sections, DARS said in a press release on
Tuesday, 14 November.
According to the company, the loan offers the lowest interest rate of any taken out by the
company with commercial financial institutions. DARS had already taken out a EUR 75m
loan from DEPFA in May last year.
DARS has been forced to secure an increasing number of loans for motorway construction in
line with a government strategy that cuts state funds for the motorway company. The loans
are being paid off with the proceeds from tolls.
Luka Koper Sings Deal with World's 13th Largest Port
Representatives of Slovenia's Luka Koper and Malaysia's Port Klang have signed a sister port
agreement
Representatives of Slovenia's Luka Koper and Malaysia's Port Klang have signed a sister port
agreement, giving the sole Slovenian seaport a chance to strengthen cooperation with the
world's 13th largest port.
The agreement, signed in Kuala Lumpur on Monday, 13 November is aimed at improving the
status of the two ports as gateways for Southeast Asia's market of 500 people and Central
Europe's 400 million market, Luka Koper wrote in a press release on Tuesday, 14 November.
Malaysian Transport Minister Datuk Seri Chan Kong Choi said upon signing the agreement
that the two ports have a favourable shipping time of 17 days, and they share competitive
shipment prices.
The minister believes that shipments between them will rise rapidly and reach 100,000
containers a year in 2010.
The agreement, signed on behalf of Luka Koper by vice chairman Aldo Babic, also envisages
cooperation in education, exchange of information and transport data.
25
Publisher Delo on Track in Q3
Delo, Slovenia's largest newspaper publisher, posted net sales of SIT 9.9bn (EUR 41.3m) for
the first nine months of the year, up 4% over the year before and 1% above plans
Delo, Slovenia's largest newspaper publisher, posted net sales of SIT 9.9bn (EUR 41.3m) for
the first nine months of the year, up 4% over the year before and 1% above plans. Pre-tax and
net profits remained on par with last year's, the company said in a press release on Tuesday,
14 November.
Pre-tax profit totalled SIT 378m (EUR 1.57m), with net profits at SIT 284m (EUR 1.18m),
the company said after the results were presented to the supervisory board.
Delo attributes the good performance to its appropriate adaptation to the market situation,
higher advertising revenues, new subscriptions and the development of new products.
Mercator Reports 18% Increase in Q3 Revenues
The Mercator Group posted SIT 351.3bn (EUR 1.465bn) in net sales revenues in the first
three quarters of this year, up 18% year-on-year
The Mercator Group posted SIT 351.3bn (EUR 1.465bn) in net sales revenues in the first
three quarters of this year, up 18% year-on-year. This follows from the operations report
passed by the supervisory board of Slovenia's largest retailer.
According to a press release posted on the web pages of the Ljubljana Stock Exchange on
Wednesday, 15 November, the group's net profit of SIT 5.1bn (EUR 21.28m) in the period
represents 83.3% of the planned profit for 2006.
The release says that the session of the supervisory board also discussed an audit report on
Mercator's operations under the former chairman Zoran Jankovic.
A draft report, composed by Deloitte&Touche auditors, was leaked to the public just days
ahead of the 22 October local elections, in which Jankovic won the post of the Ljubljana
mayor.
The supervisory board assessed the retailer's operating results as successful. The opinion
reflects the view of the management.
Mercator says this year's Q3 operating results are not directly comparable to last year's due to
the "extraordinary accounting events" affecting the profit.
The press release quotes the decline in the company's rating and assets as a result of the
takeover of grocer Era's subsidiaries and property in Croatia in 2005 in the amount of SIT
4.1bn (EUR 17.11m) and the SIT 1.5bn (EUR 6.26m) profit from the sale of Sava shares in
the same year.
Extraordinary accounting profits excluded, the comparable net profit in the first nine months
of this year amounted to SIT 4.5bn (EUR 18.78m), up 20.2% year-on-year, the release says.
Mercator to Consolidate Position of Leading Retailer in SE Europe
After a tie-up with Serbian holding Rodic M&B that created the largest retailer in Southeast
Europe, Slovenian retailer Mercator has said it would be looking into other options in the
region to consolidate its market position
After a tie-up with Serbian holding Rodic M&B that created the largest retailer in Southeast
Europe, Slovenian retailer Mercator has said it would be looking into other options in the
region to consolidate its market position.
"As far as increasing market share in Serbia is concerned, we are done with the tie-up with
Rodic. Now we are actively looking into possibilities in Croatia and Bosnia-Herzegovina but
there are no concrete agreements yet," Mercator chairman Ziga Debeljak told the press on
Wednesday, 15 November.
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According to him, the retail sector in the countries of the former Yugoslavia is relatively
unconsolidated, so partnerships are expected. Mercator will take part in the action, but it is not
yet clear what the form or the time frame of the tie-ups will be.
Especially in Croatia Mercator will try to forge a strategic partnership as soon as possible in
order to "increase its market share and secure volumes that will allow long-term, competitive
and profitable business in Croatia," Debeljak said.
With the creation M-Rodic, which was wrapped up in mid-October, Mercator raised its
market share in Serbia to 10%. It is projected that M-Rodic will post revenues of EUR 300m
next year, which would raise Mercator group's combined sales to EUR 2.4bn, Debeljak
explained.
Asked about the announced strategic partnership between the market leaders in Croatia and
Serbia, Agrokor and Delta, Debeljak said that this cooperation had existed in a less formal
form before, so the tie-up would "not alter the competition make-up of both markets".
The Mercator Group announced net sales of SIT 351.3bn (EUR 1.465bn) for the first three
quarters of the year, up 18%, with a net profit of SIT 5.1bn (EUR 21.28m).
Debeljak would not talk about detailed projections for 2007. He only said that the market
share would be 45% in Slovenia, 8% in Serbia, between 5% and 6% in Croatia and about 2%
in Bosnia-Herzegovina.
Railways to Cut Losses by End of Year, Management Claims
The Slovenian Railways Holding generated a loss of SIT 2.55bn (EUR 10.64m) in the first
nine months of 2006
The Slovenian Railways Holding generated a loss of SIT 2.55bn (EUR 10.64m) in the first
nine months of 2006, up SIT 409m (EUR 1.7m) over the same period last year. However,
acting manager Branko Omerzu believes that the company will cut the loss by the end of the
year.
"We expect that the loss will be less at the end of the year than now," Omerzu told the press in
Ljubljana on Wednesday, 15 November.
He believes that the loss at the state-owned railways operator will be cut as a result of
September's additional cost-cutting measures. The company will also not take out any shortterm loans before the end of the year, regardless of whether it manages to sell any of its assets
or capital stakes, he added.
According to preliminary data, the loss already decreased in October due to larger transport
volumes, streamlining of business operations and more efficient recovery of claims.
Apart from the outdated infrastructure and higher costs of resources, the Railways also faces
rising expenses due to the poor condition of its engines and carriages. The majority of engines
are some 30 years old, while 85% of carriages are over 21 years old, Omerzu revealed.
This has caused the railways SIT 2.5bn (EUR 10.43) in maintenance costs in 2005 and 2006,
a major factor contributing to losses in cargo transports.
In the January-September period, the Railways increased the volume of transported cargo by
4.3% to 13.7 million tonnes in comparison with the same period last year. The number of
passengers also increased by 1.8% to 11.6 million persons. "We work more but get less,"
Omerzu said.
The company's revenues amounted to SIT 51.8bn (EUR 216.15m), a 6.8% increase over the
same period last year. Expenses meanwhile rose by 5.7% to SIT 53.4bn (EUR 222.83m).
The company has also began drafting a response to the adverse opinion recently issued to it
by the Court of Audits for operations in 2004.
Krka Reaches EUR 500m in Sales in Q3, Profit Up 28%
Pharma company Krka saw a continuation in strong sales in the third quarter of this year
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Pharma company Krka saw a continuation in strong sales in the third quarter of this year. The
company reported on Thursday, 16 November sales revenues of SIT 120bn (EUR 500m) for
the first three quarters of the year, which is 23% more than in the same period last year. The
group's net profit was up 28% at SIT 19bn (EUR 79.3m) in the same period.
Company officials told a press conference in Novo mesto on Thursday, 16 November that
foreign sales were the catalyst of growth. Leading the way was a strong growth in sales of
prescription medicines in eastern Europe.
According to chairman Joze Colaric, the company expects to maintain robust sales throughout
the year as well as into next year.
The group plans to generate sales of EUR 750m next year. Moreover, the company's booming
operations are to result in the creation of an additional 500 jobs next year, foremost in sales
and marketing, said Colaric.
The Russian market led the way in terms of sales growth for Krka, with sales growing by 46%
to SIT 25.7bn (EUR 107.2m). Sales in the whole of eastern Europe rose by 37% to SIT
34.1bn (EUR 142.3m).
Sales on markets of central Europe stood at SIT 30bn (EUR 125m), which is 26% more than
last year, with sales in Poland registering the quickest growth, rising 30% to SIT 17.4bn (EUR
72.6m).
Sales in western Europe and oversees markets rose 22% to SIT 17.8bn (EUR 74,3m), while
sales in SE Europe were up 19% to SIT 19.5bn (EUR 81.4m), Krka said.
The domestic market's share in total sales continued to diminish as it registered growth of
only 3% to SIT 18.7bn (EUR 78m).
The sale of prescription medicines, which grew by 25% to SIT 91.7bn (EUR 382.7m),
accounted for 81% of total sales in the first months of the year.
Krka intends to spend SIT 31.5bn (EUR 131m) for research and development next year,
Colaric said. One of the bigger investments is to be the expansion of capacity at the facilities
of Krka's health tourism arm, Zdravilisca Krka.
Ex-Telekom Boss Becomes Chief Exec of Belgian Mobile Operator
Libor Voncina, the former boss of Slovenian telco Telekom Slovenije, has been appointed the
new chief executive officer of Belgian mobile operator BASE
Libor Voncina, the former boss of Slovenian telco Telekom Slovenije, has been appointed the
new chief executive officer of Belgian mobile operator BASE effective on 15 November.
Voncina will be responsible for the day-to-day business in Belgium and the continued
implementation of the BASE strategy on the Belgian market, the company said in a press
release on Wednesday, 15 November.
He will report to Stan Miller, the current CEO, who will stay on as the executive chairman of
the BASE board.
Voncina had been the chairman of the Telekom Slovenije board for two years before he
resigned in March this year.
BASE says that he brings a wealth of experience in the IT and telecommunications industries
to the company.
"Over the last couple of years, Voncina has been instrumental in repositioning Telekom
Slovenija for continued revenue and profitability growth," the press release reads.
Base has a 21% market share in Belgium at the end of the third quarter of this year. Last year
it posted sales of EUR 548m.
Merkur Sees Sales Soar, Profits up 4%
Retailer Merkur posted sales of SIT 168.4bn (702.7m) for the first nine months of the year, up
nearly a quarter year-on-year
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Retailer Merkur posted sales of SIT 168.4bn (702.7m) for the first nine months of the year, up
nearly a quarter year-on-year. Net profit meanwhile edged 4% higher to SIT 2.1bn (EUR
8.8m), the company said on Thursday, 16 November.
The hardware group said sales increased across all segments. Revenues were buoyed by the
integration of Sava Trade, a recent acquisition, but even without it sales would have been 19%
higher.
Metallurgy products were the fastest growing segment, with sales up 28%. Other segments
such as construction materials and consumer goods grew at a rate of 23%.
The group's sales abroad were up 40%. Plans are afoot to expand the network in selected
markets, in particular Croatia and Serbia.
The supervisory pored over the results at a session on Thursday, 16 November, assessing
them as favourable.
Vino Brezice to Get EUR 1.5M in State Aid
The company will get SIT 40.5m (EUR 169,000) in subsidies to avoid layoffs, SIT 18.2m (EUR
76,000) for training programmes and SIT 300m (EUR 1.25m) in a 7-year loan
The government has allocated state aid of SIT 358.7m (EUR 1.5m) to beverage company
Vino Brezice for the purpose of restructuring.
The company will get SIT 40.5m (EUR 169,000) in subsidies to avoid layoffs, SIT 18.2m
(EUR 76,000) for training programmes and SIT 300m (EUR 1.25m) in a 7-year loan, the
government said following its session on Thursday, 16 November.
The state aid will be allocated under the condition that the banks owning the company
transform claims of SIT 300m into capital. The banks in question are Postna banka Slovenije
(SIT 101.9m/EUR 0.43m), NLB (SIT 88.2m/EUR 0.37m) and SKB banka (SIT 109.9m/EUR
0.46m).
Another condition is that SKB bank offsets its claims with the money from the sale of an
office building under SKB mortgage.
Part of the state loan will be used to pay off the banks, the government said in a press release.
Intereuropa Sales Off-target, Profit Buoyant
Logistics company Intereuropa posted sales of SIT 38.4bn (EUR 160.2m) for the first nine
months of the year, up 4.3% on the year before but 1% off-target
Logistics company Intereuropa posted sales of SIT 38.4bn (EUR 160.2m) for the first nine
months of the year, up 4.3% on the year before but 1% off-target. Profits exceeded plans by
6.5% to top SIT 1.5bn (EUR 6.26m), the company said on Friday, 17 November.
Sales lagged behind projections mostly due to worse-than-expected results at the Austrian
subsidiary Schneider& Peklar and the Slovenian road haulage division Intereuropa Transport,
where measures to improve performance have already been taken.
The Koper-based company expects business to pick up in the two subsidiaries in the last
quarter, so the end-year forecast remains within reach.
In a Mature Market, Petrol is Seeking to Expand Southwards
Energy company Petrol posted bumper profits for the first three quarters of the year
Energy company Petrol posted bumper profits for the first three quarters of the year: sales
expanded by 12% to SIT 342bn (EUR 1.43bn), with profit soaring by 30% to SIT 9.5bn (EUR
39.6m). However, the Slovenian market is mature and volume sales of oil derivatives edged
up only 1%, so the company is looking for growth opportunities on other markets.
This year about half of all investment was funnelled to foreign markets and acquisitions in the
region will intensify in the future, Petrol chief executive Marko Kryzanovski told STA.
29
"Some 32% of the funds for investment was earmarked for Slovenia, 36% for markets in
Southeastern Europe and the rest for the electrical energy sector. This is a clear indicator of
where Petrol wants to go."
According to Kryzanovski, Petrol is interested in taking part in the construction of the BukBijela hydro power plant in Montenegro, a joint project by Montenegro and BosniaHerzegovina.
He said that Montenegro wanted to pursue a very ecological policy towards such projects, but
it also had a big gap in power generation.
"A compromise will have to be found, but this is a matter for politicians and the state. We are
interested in taking part, but not at any cost," Kryzanovski explained.
Petrol is also keen on Montenegrin petrol retailer Jugopetrol Kotor even though it had lost out
to Helenik Petroleum in a bid for a controlling stake. Subsequent steps depend on how
Helenik will be selling the company, Kryzanovski said.
Kryzanovski is also pleased with the gas business, which the company is focusing on
Southeastern Europe.
He said Petrol was the first foreign company to get the chance to distribute natural gas in
Serbia, while it also signed a memorandum of understanding with Montenegro Bonus on the
storage, distribution and sale of oil derivatives and gas.
Petrol has recently forged a joint venture with Russian oil company Lukoil, Ptreol Lukoil,
which will focus on the retail of oil derivatives in Southeastern Europe. The company has not
started operating yet.
"We wish to carry out all procedures transparently, without rushed decisions. All the
necessary procedures take a lot of time," he said.
Kryzanovski accompanied Prime Minister Janez Jansa on a five-day visit to Saudi Arabia and
Kuwait this week. He said Saudi Arabia was interesting in the fields of ecology and
successful use of resources.
"We also discussed potential for cooperation in the transfer of petrol's technology and
highlighted cooperation with certain oil companies, especially in supply," Kryzanovski said.
Zito Ups Its Bid for Mlinotest
Food company Zito has raised the stakes in the takeover of bread and pasta maker Mlinotest,
publishing a new offer of SIT 1,700 (EUR 7.09) per share
Food company Zito has raised the stakes in the takeover of bread and pasta maker Mlinotest,
publishing on Saturday, 18 November a new offer of SIT 1,700 (EUR 7.09) per share. The
offer outbids the rival bid of family bakery Pekarna Blatnik by SIT 10 (EUR 0.04).
Zito first published a takeover bid for Mlinotest on 23 October, offering SIT 1,680 (EUR
7.01) per share with a takeover target of 33% - Zito already holds a 17.04% stake. The new
deadline of the bid, which only changes the prize of the share, is 4 December.
This is just the latest development in a takeover story that started with the announcement of
Pekarna Blatnik in early October that it would seek to acquire its bigger rival Mlinotest.
Pekarna Blatnik last offered SIT 1,690 (EUR 7.05), SIT 90 (EUR 0.38) more than in its initial
bid published on 3 October.
In the offer published on Tuesday, 14 November, the Velike Lasce-based bakery also lowered
the takeover target to 50% plus one share, or a total of at least 1,194,589 Mlinotest shares.
The deadline of Pekarna Blatnik's the bid is also 4 December.
Outgoing CCIS Chairman Proud of What Chamber Has Achieved
"CCIS is today one of the best chambers in Europe," Cuk said about his achievements in an
interview with STA
30
Jozko Cuk, who is expected to step down as the long-term chairman of the Chamber of
Commerce and Industry (CCIS), says he has been part of a successful social and economic
dialogue that has enabled Slovenia a stable economic development, paved its way to the EU
and consolidated its position on the markets of former Yugoslavia.
"CCIS is today one of the best chambers in Europe," Cuk said about his achievements in an
interview with STA. Cuk, who has been at the helm of CCIS for 11 years, also said that he
would continue to work for the Slovenian economy for a further 15 years at least.
Cuk's motive to stand for CCIS chairman back in 1995 was his wish to change the way the
chamber operated, to make it more international. "Since we ran long-term projects, which
cannot be completed in one term, I decided for a second and in 2003 for a third term in
office."
Obligatory membership in CCIS was introduced in 1990, following the example of Slovenia's
most important trade partners, such as Germany, Italy and Austria. This year, new legislation
abolished obligatory membership.
"In all these years, companies have got used to it that CCIS can give them all the answers
regarding employment relations, collective bargaining agreements, wage policies etc.," Cuk
pointed out.
According to him, the chamber has become an important partner for the state and trade
unions, as well as a business meeting point for Slovenian companies. Through its international
cooperation, the chamber enabled the companies to establish new partnerships and open up
new roads to business.
While underscoring training as one of the chamber's key missions, Cuk believes CCIS played
a pivotal role in representing the interests of the Slovenian economy.
"Surely one can always do more. But at the given balance of political power we have achieved
a number of legislative changes with important impact on companies' operations," Cuk said,
quoting the latest success in changing the tax legislation package.
Cuk disagrees with the reproach that the chamber is too rigid an organisation that is too
remote from its membership. "More than 500 companies have been involved in CCIS
management bodies, the assembly, the supervisory board..., the meetings brought together
different views, positions on CCIS operations."
The outgoing chairman believes that one of the chamber's greatest achievements was its role
in integrating the Slovenian economy. "We are a well-known social partner in collective
agreements."
He explained that CCIS signed the general collective agreement that contributed to much
lower operating costs for the companies. "After the document was cancelled last year, we
managed to negotiate a collective agreement on wage policy which is more favourable on the
economy."
Cuk went on to point out that, after the ties with the countries that emerged on the territory of
the former Yugoslavia broke, CCIS was among the first to encourage establishing market
economy in those countries. He said these efforts culminated in the formation of CCIS branch
offices in Belgrade, Sarajevo and Pristina.
"A major success was definitely the active role during Slovenia's accession to the EU. CCIS
had its representative in the core negotiating team and was also represented in 31 expert
negotiating groups."
At the time, the chamber played a leading part in terms of securing good conditions for the
economy, Cuk said, adding that CCIS actively supported Slovenia's entry into the EU
throughout.
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SLOVENIA IN BRIEF
Retailers Establish Chamber of Commerce
Major Slovenian retailers held Friday, 17 November a founding assembly for the Chamber of
Commerce (TZS), the first new chamber to be established in Slovenia after the act on
chambers entered into force earlier in the year. Representatives of all the major Slovenian
retailers were present at the session, including Mercator CEO Ziga Debeljak, Spar chief exec
Igor Mervic, Engrotus CEO Aleksander Svetelsek and Petrol's Marko Kryzanowski. All apart
from Debeljak are also in the 26-strong management of the chamber. The 82 participants at
the assembly elected Bojan Papic, CEO of furniture retailer Lesnina, president as well as
adopted the articles of association, programme of work, a financial plan, and elected its
temporal bodies.
Slovenia, Saudi Arabia to Forge Closer Defence Ties
Slovenia and Saudi Arabia agreed to launch cooperation in the area of defence, as Slovenian
Defence Minister Karl Erjavec held talks with Saudi Chief-of-Staff Saleh Al Mohaya in
Riyadh on Sunday, 12 November.
Drnovsek Visits Austrian President, Unveils New Book in Vienna
President Janez Drnovsek held a working meeting on Tuesday, 14 November in Vienna with
his host and counterpart Heinz Fischer that examined topical international issues. Prior to the
meeting, Drnovsek presented his new book on self-awareness at the Vienna Book Fair.
EU Education Ministers Debate Upgrading of Higher Education
Education ministers from the EU convened on Tuesday, 14 November for a meeting that
focused on upgrading higher education in Europe and on future guidelines in education.
According to Jure Zupan, the Slovenian minister of higher education, science and technology,
the debate revolved around how the governments can help forge ties between universities and
companies.
Employers Endorse Free Movement of Labour at Meeting
The EU must ensure free movement of labour, both among EU member states and third
countries, an international labour conference was told in Ljubljana on Wednesday, 15
November. Europe faces aging of its population and a serious shortfall of workers in certain
sectors, Azfer Khan of the International Labour Organisation told the conference entitled
"Mobility of Labour - Challenges for the Future".
PM Makes Unexpected Call on Slovenian Soldiers in Iraq
Prime Minister Janez Jansa made an unscheduled stopover in Iraq on Wednesday, 15
November to visit four Slovenian army instructors who are training Iraqi security forces in a
base near Baghdad. He also held meetings with Iraqi Prime Minister Nuri al-Maliki and
Foreign Minister Hoshyar Mahmud Zebari.
Slovenia and Kuwait Sign Accord on Cooperation in Culture
Slovenia and Kuwait signed an accord on cooperation in culture on Wednesday, 15 November
in a bid to promote exchange and joint projects across all areas of culture, from film and
theatre to museums and cultural heritage. The agreement, which was signed by Foreign
Minister Dimitrij Rupel and Deputy Kuwaiti Foreign Minister Sheikh Ahmed Abdullah al32
Sabah, says that the two countries would promote exchange between institutions and
individuals.
Economic and Social Councils Call for Stronger Social Dialogue
The Euro-Mediterranean summit of economic and social councils kicked off on Thursday, 16
November in Ljubljana with representatives from 25 EU member states and 10 Mediterranean
countries focusing on promoting development and balanced progress among countries north
and south of the Mediterranean.
Over 300 Wines at This Year's Slovenian Wine Festival
The 9th Slovenian Wine Festival opened in Ljubljana on Thursday, 16 November, featuring
more than a hundred Slovenian and foreign vintners, who presented and offered about three
hundred brands of superior wines. This three-day festival was organised by Infos Company.
33