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OctoberTHE YEAR IN BUSINESS
30 Dec 2013 Jana Liptáková Business
Slovalco seals discount electricity deal. Slovalco, the aluminium producer, signed a long-term electricity supply contract with the power utility Slovenské Elektrárne (SE). The contract provides for the supply of electricity to the aluminium smelter, totalling 19 terawatt-hours for a period of eight years, from 2014 to 2021. The company did not want to specify the price of electricity. Slovalco will thus presumably continue producing aluminium in its Žiar nad Hronom facility and thus preserve 3,000 jobs connected with the production and processing of aluminium.
Minimum wage to rise. The government passes an increase in the monthly minimum wage of 4.2 percent or €14.30 per month to €352. The change will take effect on January 1, 2014. The minimum hourly wage will increase from €1.941 to €2.023.
Stimuli for IBM and T-Systems. The Slovak government will support IBM and T-Systems investment activities in the Košice region with a total of €6.66 million in incentives. IBM Slovensko will get €1.6 million to broaden its existing delivery centre of IT services in Košice, a project that should bring 150 new jobs by the end of 2015. T-Systems Slovakia Košice will receive stimuli worth €5.1 million to enlarge its IT centre, a project expected to bring 350 new jobs by the end of 2016.
Slovakia’s economic forecast improves. Moody’s, one of the major credit rating agencies, issued a brighter outlook on Slovakia’s economic prospects, but the country’s creditworthiness remains unchanged. Moody’s revised its forecast for Slovakia from negative to stable, but opted to keep its credit rating at the A2 level, something not expected to change in the short term. Slovakia’s improved outlook came due to expectations that its public debt in 2014 will stabilise below 57 percent of GDP.
Baťa heirs seek compensation. Heirs of Czech businessman Jan Antonín Baťa, who once oversaw the Baťa shoe company’s global empire, seek compensation from the Slovak government for property confiscated in the wake of World War II as part of the infamous Beneš Decrees. Some have valued the demand at €1 billion. In April, a Bratislava district court exonerated Baťa of wrongdoing and cancelled a 1947 court ruling that sentenced him to prison and ordered the forfeiture of assets. Since then, the family has considered pursuing compensation for the assets seized in 1947. The proceeding was interrupted in October after the Slovak Finance Ministry requested additional written evidence.
Slovakia’s business environment worsened. The quality of the business environment in Slovakia dropped according to the Doing Business ranking, which placed Slovakia 49th out of 189 countries in its 2014 edition, six spots lower than the previous year. The results of the ranking, released in late October 2013, show that while in the previous edition Slovakia sat higher than its Visegrad Group neighbours, this year its position worsened even in the regional comparison.
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