Archive of articles - November 1997, page 3

Slovakia among five new markets included in IFC index

LONDON- Slovakia entered the investment mainstream on November 3, joining Russia, Israel, Egypt and Morocco when these emerging markets were added to the key International Finance Corp (IFC) stock index.However, the expansion of the IFC's Investable Composite Index was overshadowed by the global stock market turmoil, analysts said. "It's a bit of a red herring in today's market," said John-Paul Smith, Russian analyst at Morgan Stanley Dean Witter. "A far bigger effect will come from people reappraising their weightings in emerging markets as a whole. "The IFC, the private-sector affiliate of the World Bank, now has 31 constituents for its composite index, which is reviewed each year. This excludes Nigeria, which is tracked but not considered investable.

Foreign trade turnover reaches 482.744 bn Sk

Despite progress, Slovak housing market still hampered by ancient practices

Reaction to the VÚB mortgage announcement was markedly subdued. Real estate agents and brokers said they expected some increase in business as a result of the new mortgage plan, but added that the Slovak real estate market was being held back more by byzantine ownership regulations than low liquidity.Igor Fedoroňko, executive director of Bratislavská Realitná Kancelária (Bratislava Real Estate Office, BRK), said that he did not think the VÚB plan would have any significant impact on construction of new housing units in Slovakia because it did not address the root causes of the country's housing crisis."In the last eight years, hardly any housing has been built in this country," he said (see chart this page). "Building flats is in the hands of private industry now, but since financing construction projects is still incredibly costly, and the government is still doing nothing to create the proper administrative conditions for investment, mortgages can have little effect."

IKEA reports 453 million Sk turnover

McDonald's to open on Obchodná ulica

Out of Touch

October 1997Slovakia's government has kept the country out of the EU and NATO by scorning democracy. Now the economy could go up the spout as well. Slovakia's government lives in a world of its own. Discreet messages from multilateral organizations are scrunched up and hurled in the diplomatic waste basket. Public expressions of concern over Slovak democracy from the EU are routinely condemned by Prime Minister Vladimir Mečiar and his men as unjustified meddling in Slovak internal affairs.In the latest display of Slovak statecraft, Mr.Mečiar suggested, to the astonishment of his Hungarian counterpart, Gyula Horn, that their countries exchange ethnic minorities. A fortnight later, Slovak officials were entertaining the xenophobic Jean-Marie Le Pen, boss of France's extreme right National Front. "The problem with Slovakia," says an EU country diplomat, "is that there is no-one in the government with a clue about international affairs."

Gypsies flee to Great Britain's shores

British tabloids have been having a field day with recent Romany immigrants seeking asylum in the United Kingdom. In total, 292 Romanies from the Czech Republic and Slovakia claimed asylum in the port of Dover between October 17 and 30, adding to about 400 Romanies who had applied between the end of July and October 16.Despite these relatively low numbers, the yellow press has carried reports of a "tide of scrounging applicants" who have already "buried" relief facilities, and of the "flood of 3,000 Gypsies" who are now en route to Britain "to milk the benefits system."Tabloid headlines notwithstanding, public opinion in Britain is sharply divided on the issue of Romany asylum seekers. On the one hand, many Dover residents have said that the refugees are stretching cash-strapped social services past the breaking point, while others have accused Romanies of cynically manipulating asylum laws to improve their economic situation.

Rich history explodes in and around town castle

Though the path is steep, anyone journeying up the Trenčín castle hill surely won't regret the effort. The bird's eye view from the top shows the old town surrounded by sturdy, ancient walls, old houses clinging to one another behind fancy modern buildings, and a stream of cars heading toward the center. The glistening blue ribbon of the Vah river separates the old town from its dreary industrial districts.It is not difficult to imagine ancient peoples like the Celts, Germans and Slavs surveying the landscape from the very same hill. The renowned Greek historian and astronomer Ptholemaios in the 2nd century AD drew a map of the then-known world which depicted a settlement named Leukaristos (Greek for the Latin name Laugaritio) where Trenčín lies today.Laugaritio was founded after the Romans seized Podunajsko (a region along the Danube river) and established a province known as Panony.

Slovakofarma places GDRs on foreign markets

Slovakofarma, a.s. Hlohovec, the largest pharmaceutical company in Slovakia, announced on October 13 a successful placement of its global depository receipts (GDR) on international markets, becoming the first fully private Slovak company to raise funds this way.Each GDR has a face value of 1/15 of an ordinary share which carries voting rights, and is transferable to shares. A total of 4.95 million GDRs were issued, representing 330,000 of Slovakofarma shares, or 19 percent of the company's registered capital with voting rights.The issue was administered by Nomura International, a London-based investment bank well known for its activities on emerging markets, especially in Central and Eastern Europe and particularly in Slovakia. Besides the Slovakofarma GDR transaction, Nomura also manages the $250-300 million bond issue of the Slovak government, and recently announced a $120 million bridging loan for Slovakia's highway construction.

Making fishers of men Slovak Romanies need autonomy, not more hand-outs

Prime Minister Vladimír Mečiar revealed on October 29th that the Slovak government was sending buses to London and Calais to bring back the Romany families who have recently fled the country. "They're our citizens, they are a part of our society," he said, and promised that their political and civil rights would be "respected."Mečiar's coalition government has not always had such conciliatory words for its Romany citizens. SNS leader Ján Slota has produced such nuggets of wisdom as "with gypsies you need a small courtyard and a long whip," while Mečiar himself has warned Slovaks that "if we don't deal with them now, then they will deal with us in time." Statements like these belie the government's assertion that the flight of Slovak Romanies was "not politically motivated." They also give the Romany families camped in Dover reason to doubt that the buses laid on by the government will return them to a country where their rights are suddenly enshrined.

Survival Tips: Getting around town

George Clooney, the newest Batman and star of "The Peacemaker," a film shot in Bratislava last year, poked quite a bit of fun at Bratislava on an American talk show just last month. One of his anecdotes recalled a taxi ride in Bratislava - Clooney complained that the driver smelled and, much to his amazement, couldn't speak a word of English.Bratislava residents should applaud Clooney's courage - the poor fellow obviously felt all at odds in such a forsaken place. They should also be reminded of how often foreigners bring their prejudices with them when travelling, making a nightmare of a place which in reality is not so bad. So, the following survival tips for taking a taxi in Bratislava may help not only future Clooneys but also current city dwellers.Clooney had one thing right - it is indeed difficult to decide at first glance which taxi won't rip you off, take you on a joy ride or, heaven forbid, smell.

Driven by state activities, money market stays unharmed by world turmoil

Slovak interbank money market rates soared to high levels during the last two weeks of October. The main events on the market were the two auctions of state securities by the Finance Ministry. The yields from state treasury bills (T-bills) have skyrocketed, reaching record heights on October 16, averaging a 30.617 percent yield at an auction of 34-day T-bills.The money market crunch, resulting partly from the late May attack on the crown, has made refinancing of the state budget shortfall more expensive and boosted local interest rates. This prompted Finance Minister, Sergej Kozlík to hold talks with the central bank and commercial banks on October 22 and request the commercial banks to stop the trend of unacceptably high yields they demand from state securities.This has brought positive results, since a consensus was reached that interest rates should go down to slightly lower levels. Kozlík didn't specify in what way or who exactly should cut rates but he said he foresaw a decline in yields to around 25-26 percent.

Pepsi Cola launches new filling line

Around Slovakia

Mečiar's niece marries Havel's distant relative"Special Forces" stop activists

Synagogue for sale

Not all synagogues are waiting for the state to do something. One, ironically in the town of Bytča (population 12,000) - the birthplace of Jozef Tiso, president of the Slovak wartime state who was charged with deporting more than 200,000 Jews from Slovakia - is up for sale.The agency Ra-Realing has been trying to sell the synagogue for two years. It covers 400 square meters, and is in comparably good shape considering that it was used as a grain storage house for years.Since the building is preserved by the Ministry of Culture, a potential buyer needs to have an acceptable plan for use - meaning the synagogue cannot be flattened or used for purposes "unsuited" for a cultural monument.

Inside the making of Rivers of Babylon:

It has been a white water journey for "Rivers of Babylon," a film currently finishing production at Bratislava's ALEF studios. The project, based on the controversial 1991 best-selling debut novel of the same name by Peter Pišťanek, has been in the works since 1992 and continues to struggle as it nears completion .Producer Marian Urban and Minister of Culture Ivan Hudec have squabbled over the release of 4 million Sk from the Pro Slovakia fund. The ministry is uncomfortable with the film because comparisons have been made about the main character of the movie and Prime Minister Vladimír Mečiar. Urban, however, flatly denies that there is any similarity.Still the film will be completed after five more days of shooting and will hit Slovak movie theaters by the beginning of next year. The drive to finish the film has come from a crew that has united around the powerful story, which takes a critical look at contemporary Slovak history.

Unemployment increases 1.21%

Times are a-changing at Coopers & Lybrand

Comings...Malcolm Best, 45, has become the Partner in Charge of Coopers & Lybrand Slovakia. Best obtained his FCA (Fellow of the Institute of Chartered Accountants) in England and Wales. He started working at Coopers & Lybrand in 1980 in the United Arab Emirates and became a Partner in 1984. He has worked in the Audit Industry, especially in the oil and gas industry, telecommunications and investment. Best moved to Slovakia one year ago as a Senior Partner. Though his native language is English, he is now trying to cope with Slovak. In his spare time, Best likes diving, sailing and camping.

Underground parking planned at Hotel Carlton