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SLOVAKIA


 

 

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Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 31,868 23,700 20,500 59
         
GNI per capita
 US $ 4,920 3,950 3,760 73
Ranking is given out of 208 nations - (data from the World Bank)

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Update No: 121 - (27/06/07)

Meciar recidivus
Slovakia's former authoritarian prime minister, Vladimir Meciar, has been generally written off as a has-been. A bulky impressive-looking man, despite his short stature, he accepted the negative verdict of the electorate in 1998, stepping down from power after only one elected term (he had been the communist boss beforehand, but, as everyone knows, the communists believed in being economical with democracy). He obviously saw himself as the embodiment of his nation, whose independence he had declared in 1993. 

This withdrawal from the limelight, seen as so ignominious at the time, may turnout to have been a masterstroke, ensuring his popular return one day. He knew that highly unpopular reforms were necessary. He may well have thought that it was better to allow the opposition to carry them out in the shape of Mikulas Dzurinda and his radical rightist government from 1998 to last year, which made Dzurinda the darling of Brussels - but not of the people. 

In 2006 Robert Fico came to power - and immediately made a deal with Meciar. He and his party were re-admitted to respectability as partners in the new coalition government. Meciar may well be chuckling, as Fico plays the Kerensky to his Lenin, metaphorically speaking. 

Meciar to the fore
Meciar was re-elected on June 9th as chairman of his party, a member of the current Slovak governing coalition. At the congress of People's Party-Movement for a Democratic Slovakia in Nitra, 70 kilometres (43 miles) east of Bratislava, 217 of the 240 delegates voted to reappoint Meciar. 

He is now poised to succeed Fico. That is a distinct possibility. He knows how to play on the heartstrings of Slovakia Profonde as nobody else. He just has to use a bit of patience. 

The present government will trip itself up sooner or later. Then there is the saviour of the nation - its original creator. 

PMs Praise Slovenian-Slovakian Relations
Meanwhile the incumbent prime minister has his own ideas about things. The prime ministers of Slovenia and Slovakia, Janez Jansa and Robert Fico, praised relations between the countries as they met in Bratislava on 3rd June. Talks held by the two as part of Jansa's two-day official visit to Slovakia focused on Slovenia's experience in adopting the euro and international issues. 

Slovakia is planning to adopt the euro in 2009 and Slovenia's experience with the new currency will be useful for it as it gets ready for the switch. Moreover, talks also examined bilateral cooperation, viewed by the pair as being "very successful" on all fronts. 

The countries have similar views on a wide range of important international issues, Jansa and Fico said after their meeting. The biggest difference is over the future of Kosovo, where, according to Jansa, Slovenia supports UN Special Envoy Martti Ahtisaari's plan on the conditional independence of the province. 

"This is the proposal that is the most feasible in practice," Jansa said and added that it must be coupled with efforts to present Serbia with a clear European future. "It is important that the EU adopts a united stance on this issue," the Slovenian PM said. 

"There is no practical or theoretical solution that would satisfy both sides. A balanced decision of the international community is needed here," said Jansa, adding that consensus must be achieved in the UN Security Council. 

The Slovenian PM went on to say that Kosovo was in effect not a part of Serbia. "So if Kosovo gained independence tomorrow, nothing would change on the ground." 

Fico, who would not answer directly whether Slovakia supported Ahtisaari's proposal, pointed out Slovakia was a non-permanent member of the UN Security Council at the moment, which would give it a chance to contribute to the final resolution on Kosovo. He said that Slovakia endorsed the common EU stance, but added that if a resolution failed to be adopted, it could lead to some countries taking unilateral action that could destabilise the region. 

The PMs agreed that the countries have very similar stances on EU topics. Both countries support the European future of the Western Balkans and the timely expansion of the Schengen zone. Regarding the EU constitution, Jansa said the key was to "take a stop forward as soon as possible". 

Fico said that the constitution was a trauma holding back the EU project. According to him, Slovakia supports the German presidency's proposal, although not changes that would give certain advantages to one or two countries at the expense of the bloc as a whole. 

Slovenia, also, supports the German presidency's efforts in respect to the constitution, Jansa said, adding that it was important to see what the limits of compromise were. "The desired outcome is not a compromise at all cost, but a compromise for the European constitutional treaty that would facilitate progress in Europe," he said. 

Jansa added that it was pleasing to see economic cooperation between the countries grow by a quarter last year, with trade now worth EUR 500m. 

Meanwhile, Fico said Slovakia was interested in Slovenian experiences with adopting the euro, which is why Jansa will on Monday be taking part in an international conference on Slovakia's efforts to adopt the single currency. Jansa said Slovakia was well positioned to adopt the euro. 

Slovenia was well prepared for the switch because other eurozone members were ready to share their experience. "Also because of this, Slovenia stands ready to share its experience," said Jansa. 

"The adoption of the European currency in Slovenia was followed by a rise in public support for it. You too should approach it without fear," he added. 

Meanwhile, Fico congratulated Slovenia on the recently obtained invitation to join the Organisation for Economic Cooperation and Development (OECD). He added that Slovakia would support Slovenia's efforts to finalise its membership. 

Jansa also touched on the issue of US plans for a missile shield in East Europe, saying he was certain that the system was intended for defensive purposes. "Nevertheless, it would be better if this matter was tackled within the framework of NATO." 

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ENERGY

SES inks 1.5bn crown contract with Japanese company


Power-engineering company, Slovenske Energeticke Strojarne a.s. (SES) Tlmace, signed a contract for over 1.5 billion Slovak crowns on May 10th with Japanese company, Ebara Corporation, for the construction of three fluidised bed boilers for the incineration of communal waste, each with a capacity of 109 tonnes an hour, Horspodarsk Noviny reported on May 15th. 
Ebara Corp is a subcontractor of German Hochst, the energy supplier for the industrial park in Frankfurt am Main. The boilers should be delivered in the first half of 2008; and the company plans to put them into operation in January 2009, SES Marketing Director, Viliam Petras, was cited as saying. 
SES Tlmace reported sales of 568.9 million crowns in the first quarter of 2007, according to non-audited and non-consolidated results. On production costs of 775.7 million crowns, up 76.7 per cent, SES Tlmace generated first quarter added value of 218.5 million. In the first quarter of 2006 it was 180.1 million. The power engineering company closed the first quarter of 2007 with a profit of 38.6 million crowns, while in the first three months of 2006 pre-tax profit was 25.3 million. SES Tlmace produces, repairs and reconstructs equipment chiefly for power stations, and supplies fluidised bed boilers. In addition, it secures equipment supplies for the chemical, petrochemical and gas industry. In 2006, the company Segfield Investments, which is a member of the Slovak private equity J&T Finance Group, acquired a majority stake in the power-engineering firm. 

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EURO ADOPTION

World Bank says Euro adoption by 2009 is realistic

Slovakia should not have problems meeting the Maastricht inflation criterion, and is one of a few countries in the CEE region that should not fear an economic slowdown, said the World Bank's regular report on economic development in CEE countries/EU members (EU8+2), Slovak Spectator reported. 
The report was presented by World Bank Economist for Slovakia, Anton Marcincin, on May 31st in Bratislava. Only developments on world oil markets might represent a risk with respect to inflation, he added. According to Marcincin, it seems that of all the EU8+2 countries that have not yet adopted the Euro, only Slovakia has a realistic Euro adoption plan. The other countries have postponed their planned adoption dates. The World Bank's report also points out that the countries in the region as a whole have failed to use good economic development to improve their fiscal policies and lower their public finance deficits. Slovakia aims to keep its budget deficit below three percent of GDP, which is the maximum threshold for the successful adoption of the Euro.

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DEFENCE

Govt plans to invest in defence programme

Slovakia is due to invest 34 million crowns over the next three years as part of efforts to improve the European Union's defence capabilities as the Slovak government agreed to partake in a programme of collective investment in defence research and technology. The programme concerns collective spending on defence research and technology by EU-member states within the framework of the European Defence Agency (EDA), TASR reported. 
Set for 2007-2009 with an extension option, the programme's budget is close to 1.843 billion crowns, it was reported. In 2005, EDA countries invested almost 74 billion crowns in various programmes, with the bulk of the money (94 per cent) coming from France, the Netherlands, Germany, Spain, Sweden and Great Britain. Around 9.4 per cent of the total amount spent by EU-member states on defence research and technology development goes towards specific EU programmes. The EDA was set up to boost the efficiency of military spending of EU-member states.

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FOOD & DRINK

Production growth expected in breweries 

The first quarter of 2007 went well for Slovakia's breweries, as beer consumption in Slovakia now stands at some 80 litres per person per year, after falling for four years mainly due to higher consumption taxes, Slovak Spectator reported. 
Beer production is now set to stabilise, and brewers even expect an increase, it was reported. According to Heineken spokesman, Roman Krajaniak, beer consumption is now increasing partly thanks to the warm weather, and the breweries have invested in new products and packaging. Beer exports fell by a considerable 70 per cent last year. This fall, however, was partly influenced by the licensed brewing abroad of certain Slovak beers such as Zlaty Bazant (Golden Pheasant) and Saris. Roman Sustak, executive director of the Slovak Association of Beer Producers, estimated that some 45 million litres of Slovak beer were brewed abroad last year.

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FOREIGN INVESTMENT

SARIO reports many companies interested in investing

The Slovak Economy Ministry and the Slovak Investment and Trade Development Agency (SARIO) have listed around 140 companies that have shown interest in investing in Slovakia, Slovak Spectator reported. 
Slovak Economy Minister, Lubomir Jahnatek, speaking at the 14th annual International Engineering Fair in Nitra, said that most investors are interested in engineering production. A total of 880 dealers, representing 250 different firms from 25 countries, are taking part in the 14th annual mechanical-engineering fair that began in Nitra on May 22. Jahnatek said he sees potential growth in the development of small and medium-sized enterprises, which currently account for 37 per cent of Slovakia's total exports. Mechanical Engineering Union President, Milan Cagala, was cited as saying that the fair offered a unique opportunity to tackle the ever-growing competition. The organisers at the Agrokomplex exhibition grounds said that this year, there has been a greater interest in metallurgy, plastics in mechanical engineering, machine tools, welding and welding technology. According to Agrokomplex Manager, Jozef Janis, interest in commodities in electrical engineering, automation and regulation has fallen. Last year, the engineering industry in Slovakia turned profits amounting to 446.8 billion Slovak crowns (13.2 billion Euro), which represents an 11 per cent rise year-on-year. Car production is expected to make up more than half of all industrial production and more than 60 per cent of total exports in 2008, it was reported.

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FOREIGN RELATIONS

Gasparovic supports Bosnia's European integration efforts

In a meeting with Chairman of the Bosnia and Herzegovina (BiH) Tripartite Presidency Nebojsa Radmanovic, Slovak President Ivan Gasparovic said his country supports further EU enlargement and is ready to help BiH in its integration effort into Euro-Atlantic structures, according to the Slovak president's press office, New Europe reported.
Nebojsa Radmanovic thanked Gasparovic for his support, and pointed out that at the time of the break-up of the former Yugoslavia, BiH had not had the intellectual and economic power that Slovakia had when the former Czechoslovakia split up, the press release said. 
On the issue of European integration, Radmanovic said that the transformation of his country should lead to its integration into the EU, but pointed out that many reforms and changes in legislation are still needed. 
The two also spoke about current issues in the Balkans. On the issue of Kosovo, Radmanovic said it is a crucial and dangerous problem both for Serbia and the entire Western Balkan region, and all possibilities for negotiations between the Serbs and Kosovo Albanians must be explored to their full, the press release said. He was cited by the Slovak president's office as saying that the problem cannot be settled without a consensus between Belgrade and Pristina, adding that "anything must be considered and done which would lead to an agreement and not to a unilateral decision."

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FOREIGN TRADE

New trading links with Spain expected

Slovakia may well acquire new trading links in the car industry and logistics with Spanish entrepreneurs, the Slovak Investment and Trade Development Agency (SARIO) recently announced, based on the results of a recent trade mission, TASR reported. 
In the period November 2006-May 2007, a group of Spanish businessmen visited five industrial and logistics parks in Svaty Jur, Senec, Devinska Nova Ves (all Bratislava region), Trnava, and Nitra. The group also visited two companies: Grupo Antolin in Devinska Nova Ves and Teleflex Automotive in Vrable (Nitra region). "The Spanish businessmen expressed their satisfaction with the results of the visit," read SARIO's web site. The mission was organised by the Spanish Embassy in Bratislava and a chamber of trade in Barcelona. The objective was to acquire information on investment opportunities in Slovakia, and to establish new foreign-trade links and cooperation in production between Slovak and Spanish entrepreneurs. Apart from Slovakia, the four businessmen have also shown interest in the Czech Republic and Hungary, it was reported.

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