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SLOVENIA


 

 

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 26,284 21,108 18,800 63
         
GNI per capita
 US $ 11,830 9,810 9,760 51
Ranking is given out of 208 nations - (data from the World Bank)

Books on Slovenia

REPUBLICAN REFERENCE

Area (sq.km) 
20,273

Population 
2,011,473

Capital 
Ljubljana 

Currency 
Tolar 

President 
Janez Drnovsek

Private sector 
% of GDP 
40% 



 
Update No: 114 - (28/11/06)

The star in the post-communist firmament
Slovenia is an undoubted success story in the former communist world. It is almost astonishing that it was ever a communist republic at all. Tito, himself half Slovene (and half Croat), ruled it with a comparatively light leash, although this is not a point to be overdone. 
The richest republic in the former Yugoslavia, it had a per capita income five times that of the poorest, Macedonia. 
It has taken to market economics like a duck to water and is already an EU member. It has a higher standard of living than Greece or Portugal.

Macroeconomic indicators the best so far, PM says
The relations between key macroeconomic indicators have never been so good in Slovenia, PM Janez Jansa told the press on 8th November, after the European Commission projected that Slovenia's gross domestic product (GDP) growth will reach 4.8% in 2006, while the inflation rate is to stand at 2.5%.
The PM is convinced that the indicators are reason enough for even greater optimism regarding the impeding 1 January 2007 euro changeover. "Slovenia will become a part of the interior circle of the EU's developed countries, which will in itself boost its reputation and improve opportunities for the Slovenian economy," Jansa added. 
According to Jansa, while business conditions will not radically change in the short term, the stability of public finances will improve and business operations will be simplified. As a new, simpler and friendlier tax system will also enter into force on 1 January, labour costs will be gradually reduced, he said. Parliament passed the government package of tax laws earlier in November. The gradual reduction is necessary because loss of budget revenues will have to be compensated somehow after what Jansa termed "the most radical reduction in labour costs so far". 
Jansa moreover believes that the business environment will become much friendlier in the coming year, increasing the possibilities for achieving even better economic results. 
Slovenia is also reducing its budget deficit, not by reducing the scope of social and other rights, but through cost-cutting by the state, the PM explained. 

The mountains beckon the desert; PM Jansa calls on Saudi Businessmen to invest in Slovenia
Jansa made a five-day trip to Saudi Arabia on November 11-15. He called on Saudi businessmen to increase their investments into Slovenia, as he addressed the participants of a Saudi-Slovenian business conference in Riyadh on 12th November. Jansa mainly stressed investments into finance and banking, telecommunications, trade, tourism and information technology, while also labelling Slovenia as a starting point for Saudi investments into other EU states and the Balkans. 
There are great possibilities for improving economic cooperation between the two countries, the prime minister added at the conference, attended by over 100 Slovenian and Saudi businessmen, which was organised as part of his visit to the kingdom. Jansa pointed to developed infrastructure, closeness to almost all more important markets and Slovenian experience with markets of the former Yugoslavia as the country's main attributes. 
Saudi Minister of Commerce and Industry Hashim Al Yamani meanwhile called on Saudi and Slovenian businessmen to search for opportunities to complement each other, adding that both Slovenia and Saudi Arabia hold a strategic geographic position in their respective regions. Al Yamani moreover believes that Jansa's visit will allow direct trade between the two countries, while Slovenian products now come to Saudi Arabia through intermediaries. 
He also invited Slovenian companies to take part in Saudi infrastructure projects, for which the government intends to allocate US$624bn in the next 15 years, and called for establishing a direct shipping link between Saudi ports and the port of Koper. 
Jansa met Riyadh Governor Salman Al Saud. He also met Saudi King Abdallah Al Saud himself. On 11th November, Slovenia and Saudi Arabia signed a general cooperation agreement and a memorandum of understanding between their foreign ministries. 
A new axis has been forged between Ljubljana and Riyadh, portending interesting developments ahead.

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AGRICULTURE

Farmers want to keep dairy in Slovenian hands 


Farmers are increasing their efforts to keep the largest Slovenian dairy, Ljubljanske mlekarne, in Slovenian hands amidst talks on the sale of a majority stake in the company to British investment fund Salford, Slovene Press Agency STA reported October 17th.
Salford is reported to be offering 1.5 million Euro for a 54 per cent stake in the dairy that is being sold by financial firm NFD Holding along with asset management firms Zvon Ena Holding and Zvon Ena ID, food company Jata Emona and Mlekodel, which manages the shares held by cooperatives.
Opposed to the sale of the majority stake to a foreign firm, the interest groups of local communities and farmers at the National Council on October 11th succeeded with a motion with which the upper chamber of parliament called on the government to prevent the sale in order to protect the national interest. 
Peter Vrisk, a representative of the interest group of farmers and the head of the Chamber for Agriculture and Forestry, told fellow councillors that the lives of 40,000 to 50,000 people depend on Ljubljanske mlekarne. This matter "cannot be left to the capital market," he said. 
Although Mlekodel, which owns nearly a quarter of the dairy, is one of the companies selling its stake, the nine cooperatives that it represents came out of a meeting with Agriculture Minister Marija Lukacic willing to reconsider the move.
"The cooperatives are willing to reconsider...if we find a common solution that would allow them to acquire a majority share of Ljubljanske mlekarne," Lukacic said.
She said the various options of keeping the dairy in Slovenian hands would be considered, with concrete decisions to be taken when the matter will be discussed together with the state-run pension Fund management (KAD), the Association of Cooperatives and cooperatives that are not part of Mlekodel.

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FOREIGN DIRECT INVESTMENT

Investments too focused on EU markets 

Slovenia still directs too much of its foreign direct investment (FDI) onto the transparent EU market, while other countries are increasing FDI into developing countries, foremost China, Marjan Svetlicic, the chair of the International Relations Centre at the Ljubljana Faculty of Social Sciences, was recently cited as saying by Slovenia Business Week. 
Presenting a report of the United Nations Conference on Trade and Development (UNTCAD) on FDI for 2006, Svetlicic added that Slovenia recorded a rise in outgoing FDI from US$551 million in 2004 to US$568 million in 2005. The country's incoming FDI meanwhile decreased from US$827 million in 2004 to the US$496 million in 2005, making Slovenia a net exporter of funds. 
According to Svetlicic, this means that Slovenian companies have reached a level of development that requires expansion in order to boost their competitiveness. He also explained that Slovenia's possibilities for Greenfield investments lie in investments in personnel, while investments into manufacturing, except into high technology, are not likely to come about. He, however, believes that Slovenia could record a high level of FDI after privatisation, with possibilities also existing in tourism and health. The report, meanwhile, revealed that FDI is expanding around the globe. It accounted for US$916 billion in 2005, a 29 per cent increase over 2004. FDI growth was mainly recorded in developing countries (37 per cent), with 88 per cent caused by mergers and takeovers. A total of 60 per cent of FDI was invested into the developed countries, less than in the past, Svetlicic noted.

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TRANSPORT

Plans to invest nearly 9bn Euro to modernise railroad 

Slovenia plans to invest 8.89 billion Euro to modernise its railroad network in 2008-2020, reports from the Slovenian capital Ljubljana said on November 7th, New Europe reported.
The amount accounts for more than two thirds of the 12.2 billion Euro that Slovenia intends to invest in the four transport projects in the 2007-2023 resolution of national development programmes, Slovenian Transport Minister, Janez Bozic, told the press. 
Of the 8.89 billion Euro, 4.27 billion Euro will be provided through public-private partnerships, with another 4.27 billion Euro coming from the state budget and 350 million Euro from EU funds, he said. The majority of the investment will be used for the transport infrastructure on the fifth trans-European transport corridor (7.41 billion Euro) and the remaining 1.48 billion Euro for projects on the tenth corridor. The investment in railroad infrastructure is designed mainly to increase the allowed maximum weight of trains and raise the speed on the main routes to 160 kilometres an hour.

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