Summary of economic news released on Friday, February 23:
Car Maker PSA Trnava Active in Education of its Potential Workers
The French car maker PSA Peugeot Citroen Trnava does not feel a shortage of qualified labor force in its plant in Slovakia. "A combination of well managed recruitment and a system of education of new employees enables us to fill in wanted positions," the director of the Trnava plant's communication department Peter Svec told SITA. He indicated that the company has been preparing for its future needs linked with qualified employees. "Thus PSA already in 2004 started cooperating with three technical colleges in Trnava and Bratislava and with the Slovak Technical University," said Mr. Svec.
Government Does not Improve the Business Environment, Claims PAS
Think tank and lobby group the Business Alliance of Slovakia (PAS) claims that the local business environment continues to lag significantly behind developed countries. Despite of this, six months after it passed its four-year program the government has not started solving problems of the business environment. To the contrary, problems are deepening. "According to studies of the World Bank or the World Business Forum, there are about 35 countries in the world, in which it is easier to do business that in Slovakia," PAS president Martin Krekac said at a press conference on Friday. Thus, he calls on the Slovak government to adopt measures to improve considerably the environment for businessmen and not to deteriorate it gradually. PAS considers reduction of barriers to business making as the best way to catch up with developed countries as fast as possible.
Tatra-Leasing Made Contracts Exceeding SKK 7 Bln. Last Year
Leasing company Tatra-Leasing, s.r.o. Bratislava made more than 6,000 new leasing contracts with a total volume exceeding SKK 7 billion in acquisition prices excluding value-added tax last year. This represents more than 44 percent growth in the value of the contracts in a year-on-year comparison. "Thus Tatra-Leasing exceeded by almost two-times the growth dynamics of the whole market," said the Tatra Banka spokesperson Tereza Coplakova. Tatra-Leasing occupied 9.7 percent of the market of leasing of movable and immovable assets in 2006.
Slovakia Could Annually Generate 1.2 TWh of Electricity from the Wind
Slovakia could build on its territory wind farms to generate 1.2 terawatthours (TWh) of electricity annually. The deputy chairman of the Wind Energy Association of Slovakia (ZVES) Daniel Szabo further said at a press conference on February 23 that after completion of all projects, which are now under consideration, wind turbines could be built with annual production of about 0.6 TWh by the year of 2010. "Of course, the government must prepare legislation for usage of renewable energy resources comparable with neighboring countries," added Mr. Szabo.
Employers Ask for Impact Studies for Revised Labor Code
Employers demand that the Labor Ministry submits analyses and impact studies of the revision of the Labor Code on business environment in Slovakia, informed vice-president of the National Association of Employers (RUZ) Jozef Spirko at a press conference with the Slovak Association of Employers (AZZZ). The Labor Ministry informed that amendment to the Labor Code would have no impact on employment, creation of jobs, or the business environment in Slovakia. Mr. Spirko however warns that the current proposal will influence very negatively the business environment in Slovakia and Slovak economy's potential to increase employment. Moreover, the Labor Code may hamper Slovak economy's growth in the future.
Slovakia Imported 280,000 Hl of Wine in Eleven Months of 2006
Slovakia imported 280,200 hectoliters of wine worth SKK 878.2 million during the first eleven months of 2006. Wine imports amounted to 200,200 hectoliters or SKK 660.3 million during the same period of 2005. Thus, compared with the previous year's period, wine imports rose 40 percent. Slovakia's wine trade reported a negative balance of SKK 622.7 million, the Agrarian Market Information of Slovakia (ATIS) reported. During the January-November period, Slovakia imported the biggest amount of wine, almost 267,000 hectoliters worth SKK 798.7 million, from EU countries.
Tax and Customs Revenues at SKK 25.266 Bln. in January
Tax and customs offices in the Slovak Republic collected SKK 25.266 billion in revenue for the state budget in January. Tax revenues made up SKK 24.796 billion of that sum fulfilling the annual budget at 10 percent and non-tax revenues stood at SKK 470 million. Local tax collection on goods and services of SKK 20.927 billion dominated tax revenues in January. Value added tax (VAT) collection was SKK 16.184 billion, and excise tax was SKK 4.744 billion, the tax administration's spokesperson, Adriana Pleskova, informed SITA News Agency.
Analysts do not Expect the Central Bank to Change Interest Rates
BRATISLAVA, February 23, (SITA) -- The market does not expect that Slovakia's central bank will change the setting of key interest rates in the economy. However, analysts admit that the National Bank of Slovakia (NBS) could consider lowering the rates given the favorable inflation development and more that two percent appreciation of the Slovak crown since the last sitting of the NBS bank board. Slovenska Sporitelna analyst Michal Musak thinks that caution will eventually prevail, as external influences particularly oil prices could still endanger the fulfillment of the Maastricht inflation criterion.
Ministry Rejects to Dismiss Director of Air Traffic Control Company
The Transport Ministry cannot accept the requirement of the Air Traffic Controllers Association (ZRLP) for an immediate dismissal of the director general of state-run air traffic control company Letove Prevadzkove Sluzby (LPS) Roman Biro. Air traffic controllers, who are continuing in their strike, claim that management is responsible for the deterioration of air traffic safety. However, the ministry does not see any proof for this allegation. "The air space of Slovakia for civil air operation is not closed. Only its capacity is lower so that the security of air traffic is not in danger. The ministry, along with LPS, carries out steps in order to increase the accessible capacity of air space and the accessibility of airports. At present, the operational capacity is stabilized," informs the Transport Ministry.
Slovakia's FOREX Reserves Exceed USD 17 Bln.
Slovakia's foreign exchange (FOREX) reserves increased by USD 125.7 million over the past week to USD 17.0385 billion as of February 21, 2007. Reserves of the central bank were largely behind the growth, going up USD 102.9 million in a week to USD 13.9931 billion. Reserve assets of commercial banks rose USD 22.8 million in a week to USD 3.0454 billion, the NBS press department informed SITA on Friday.
JAVYS Starts Testing FS KRAO Technological Facility in Mochovce
The nuclear decommissioning company Jadrova Vyradovacia Spolocnost, a.s., (JAVYS), started active tests of the technological facility called Final Processing of Liquid Radioactive Waste (FS KRAO) in the locality of Mochovce. The facility is designed to process liquid radioactive waste that originates during the operation of the Mochovce nuclear power plant. The investments of around SKK 1 billion will cover the needs of the first and second blocks of the Mochovce power plant. Considering the capacity, the facility also is able to process waste that originates in the third and fourth blocks after the construction completion and operational start, JAVYS's spokesman Dobroslav Dobak stated.
Money Market Closes Week with Quiet Trading
The money market closed the week in a quiet trading atmosphere. Tatra Banka's Jozef Bozek stated that banks mainly traded overnights. They deposited SKK 39.895 billion in their reserve accounts in the National Bank of Slovakia (NBS) on Friday meeting the February minimum requirement on a cumulative basis at 91.76 percent, but they borrowed SKK 4.082 billion in the central bank's one-day contracts.
SE will Finish Construction of the Third and Fourth Block of EMO
The dominant power-producer Slovenske Elektrarne, a.s. (SE) will complete the construction of the third and fourth block of the Mochovce nuclear power plant (EMO). The Italian firm Enel, thus, decided after ten months since its entry in SE as its 66-percent shareholder to finish the construction of EMO, Prime Minister Robert Fico informed at a press conference on Friday after the talks with the head of Enel, Fulvio Conti.
STOCK MARKET: SAX Index Also Firms at End of Week
The Bratislava Stock Exchange (BCPB) also registered a moderate improvement at the end of the week. Shares of the power-engineering company SES Tlmace pushed up the value of Slovakia's official SAX share index 0.34 percent or 1.41 points to 412.87 points. Turnover on the BCPB declined from SKK 339.4 million on Thursday to SKK 266.6 million on Friday with SKK 6.8 million in share trading.
UniCredit Bank to Start Providing Services on April 2
The New UniCredit Bank will launch operations on the Slovak market on April 2 of this year. UniBanka director general Jozef Barta told a news conference on Friday that the fourth largest bank in Slovakia will begin operations through UniBanka's merger with HVB Bank Slovakia, which will have 93 branches in total. The cost of the merger has not yet been set; however, UniBanka has formed for this year merger reserves of SKK 180 million from last year's profits of SKK 315 million. "Nevertheless, the total cost of the merger definitely will not exceed SKK 200 million," added Mr. Barta, who should become the director general of the new bank. He said that the bank later plans to shut down six or seven branches. These will be branches that are close to each other and would not be used effectively. However, the new bank intends to extend its branch network in the following months.
Ministry Sees No Reason to Postpone Effectiveness of Labor Code
Labor Ministry does not see any reason to postpone the proposed effectiveness of the Labor Code from July 1 of this year to a later date. The ministry thus reacted to the requirement of the Slovak Association of Employers (AZZZ) and the National Association of Employers (RUZ) voiced earlier on Friday. The ministry disagrees with the opinion of employers that the revision of the Labor Code has been drafted too quickly. "This legal norm was being prepared by professionals intensively for more than half a year," states the ministry. The ministry added that above-standard talks concerning the Labor Code revision are being held. "The revision was drafted in close cooperation with social partners, who read the revision from the first wording until the last version," informs the ministry.
Expert Group to Look into Rent of Gabcikovo Waterworks to SE
Slovakia's Prime Minister Robert Fico and director general of the Italian Enel Fulvio Conti agreed to set up
a working group that should examine the rent of the Gabcikovo waterworks to country's major electricity producer Slovenske Elektrarne, a.s., (SE), in which Enel holds majority. Mr. Fico said that both sides will present all arguments to the experts. There are some issues that need to be explained, according to him. Mr. Fico underscored that the Slovak government does not have problems with Enel and they are ready to cooperate with the company at the maximum possible extent. "We have problems with misters who were walking on this carpet before the year 2006," said the prime minister.
FOREX MARKET: Trading in Slovak Crown Quiet on Friday
Trading in the Slovak currency was calm on Friday. CSOB's Richard Brza said that the crown's exchange rate moved in a narrow band between 34.32 SKK/EUR and 34.39 SKK/EUR over the whole day. The local currency closed trading at 34.31/34.33 SKK/EUR. Mr. Brza assumes that the crown could remain between 34.20 SKK/EUR and 34.40 SKK/EUR at the beginning of the next week. Foreign market players probably will wait for the news from the meeting of the National Bank of Slovakia's (NBS) Bank Board and harmonized inflation figures, as well.
SE will Complete Mochovce Nuclear Power Plant
The dominant power-producer Slovenske Elektrarne, a.s. (SE) will complete the third and fourth block of the Mochovce nuclear power plant (EMO). The Italian firm Enel that holds a 66-percent stake in SE, thus, decided after ten months since its entry in SE to finish the construction of EMO, informed Prime Minister Robert Fico who had talks with the head of Enel, Fulvio Conti on Friday. "If everything goes according to our joint ideas, construction works in Mochovce should start in the second half of this year," Prime Minister informed. Thus, EMO's third and fourth block could start electricity production in 2012.