Archive of articles - August 1998, page 2

Aluminum giant sold off, investors unimpressed

The new owners of what had been one of the last big Slovak state properties, aluminum manufacturer ZSNP, were finally introduced to the public at an August 20 press conference in the central Slovak town of Žiar nad Hronom. But stock market analysts said the public event came too late, as the murkiness of the privatization deal had done further damage to Slovakia's economic reputation.ZSNP's majority owner is now Žiarska Hutnícka Konzor-cium (ZHK), a consortium controlled by insurance company VSP Tatry with a 60% stake. ZSNP management, which has been trying to acquire the Slovak state's share in the aluminium producer for the past few years, holds a 40% stake in ZHK. Lesser stakes in ZSNP are now held by the town of Žiar nad Hronom and the municipality of Ladomerská Vieska.

Modern buildings banned from center

The city of Bratislava bears now so little resemblance to its old communist face that inhabitants have almost forgotten the past. Little remains to remind them of the sense of decay , of wanton destruction of historical treasures and mindless erection of architectural monstrosities that reigned during the communist era. The city is being given a new look, as high-priced projects proliferate around the capital.But who exactly is deciding what the new Bratislava will look like?The people behind these projects, the city's architects, often have a different vision of the future of the city's general look than do City Hall representatives. "At times we come into conflict with these modern thinking architects," said Milan Vajda, spokesman for the mayor of Bratislava, but added that when it came to old buildings, City Hall and the architects saw eye to eye.

Slovak crown rocked by Russian market turmoil

One year after an emerging market currency crisis hit the Slovak crown and sent it into sharp decline, the Slovak currency has suffered another blow, this time from the Russian financial crisis. Over the last two weeks, the Russian malaise spread across the region and prompted nervous foreign investors to leave risky emerging markets.The crown, which is pegged to a 60%-mark/40%-dollar currency basket, weakened by more than 2.0% against the midpoint, repeatedly falling to its year-low level of 5.5% on the depreciation side of the plus/minus 7.0% fluctuation band around the basket parity. But many traders remained cautiously optimistic about the Slovak crown's fate.

Eye on Vienna

Two calls, one line

SDK seeks legislative renewal

The Slovak Democratic Coalition (SDK), the country's biggest opposition party, is convinced that fixing Slovakia's chaotic economic laws is the vital first step towards revitalization of the country's small and large scale enterprises. According to Viliam Vaškovič, the party's economic expert, the legislative renewal would revive the financial and banking sector, capital markets and the housing industry."We have to follow the new trends in economic thinking from the European Union," Vaškovič said in explanation of the SDK's vision of the future Slovak economy.One of the first legal changes the SDK wants to make is to the law on banks. Vaškovič said that the party aimed to "increase the responsibility of boards of directors for all banking transactions, as well as that of supervision board members and head representatives of banks."

Slovak equity market impervious to Russian crisis

The Slovak equity market did not experience any interesting developments during the last two weeks. A low presence of foreign investors on the Slovak market meant that the market failed to react to the Russian crises, once again giving rise to ironic comments about the Slovak market's safe haven status. On Wednesday 19, the SAX closed at 112.9, down 2% compared to the level of two weeks ago.According to preliminary data supplied by the NBS, the M2 money supply aggregate went up 9.0% year-on-year in July, up 50bps from June. The NBS's target for this year is to keep M2 annual growth at 9.4%. Koruna-denominated loans to the corporate sector dropped Sk1.5bn in July and grew only 2.4% year-on-year. A continuing liquidity surplus on the money market during the last 3 months has clearly failed to trigger a considerable increase in loans to corporates.

Gladiators take up arms

August 26 may have marked the official opening of Slovakia's national election campaign period, but the country's two biggest political rivals are already well into their appeals to the voters.Premier Vladimír Mečiar's Movement for a Democratic Slovakia (HZDS) and Mikuláš Dzurinda's Slovak Democratic Coalition (SDK) are the only parties in the country that have more than 20% support among voters, and in substance if not style represent the opposite poles of Slovakia's bitterly divided political world."Both Mečiar and Dzurinda are populists. But there is a fundamental difference in their message," said Luboš Kubín, a politologist with the Slovak Academy of Science. "What will be very important during the election period is if the common man can tell the difference between truth and lies."

Interview with Johann Schusseleder, President of Ericsson Slovakia

When was Ericsson Slovakia established? What does the company focus on?The Slovak branch of Ericsson was founded in 1991, after a long history of the company's activities on the local market since the beginning of the 20th century. Up to the year 1996, the current branch was mostly oriented towards the private sector in areas of business communication, enterprise networks, and data transmission. When Ericsson became the supplier of the EuroTel GSM infrastructure at end of 1996, the focus moved strongly towards the core business: supplier of telecom solutions to public operators.

Jungle Café - a hot and entertaining atmosphere

Jungle Café, the newest addition to Bratislava's evening life, has just opened its doors. Owned by a Slovak woman and two men, one American and one Danish, the café is a welcome refuge from the Slovak capital's teenage crowd, which is deterred by the pricy menu and the absence of raucous music.Yes, Jungle Café's owners have resolved never to vex their customers with loud rock music blaring from an inferior sound system. Instead, events like the live-band Jazz Mondays are becoming a hit with a clientele that enjoys hanging out in a café rather than a sweaty drinking hole (the types of places known poetically in Slovak as "pajzel").No effort has been spared to make this place look like a tropical hideaway. The café consists of 3 rooms on 2 floors, with plenty of dark corners and sputtering candles. The owners were originally toying with a Caribbean motif, but opted at the last moment for a South American idiom, splashed recklessly over the walls by students of the Fine Arts Faculty in Bratislava.

Around Slovakia

Brutal murder of Romany womanHlinka maniaForeigners arrested crossing frontierRomany woman pickpockets PremierGrannies duke it out for Ms. Lady title

SOP vows "prosperous economy"

As a seven month-old newcomer to Slovakia's political scene, the Party of Civic Understanding (SOP) is still a little sketchy on the details of its economic program. The left-of-center grouping, led by populist Košice mayor Rudolf Schuster, intends to provide "good legislative conditions for economic prosperity," for private businesses, foreign investors, small and medium enterprises alike. And this, according to the party's official program, should lead to "the prosperity of the state and a rising standard of living for the people."To bring increased foreign investments to Slovakia, the SOP is angling "to secure political stability in the country, and provide the legislative and economic conditions which would attract foreign direct investors," said Ferdinand Petrák, SOP vice-chairman and economic specialist.

Community Grapevine

* The summer is slowly fading away, and it's time you started your social life again. So clear a space on your calendar for the "Business Cocktail" party held by American Chamber of Commerce on August 27th starting at 6pm at Hotel Danube's Panorama room. Am-Cham holds these parties on the third Thursday of every month. The next "Business Cocktail" will be on September 24th, sponsored by our very own Slovak Spectator! Everyone is invited, and encouraged to dig in to the punch.* Still looking for adventure in Slovakia's beautiful mountains? Then give the Climbing School a call in Záskalie, Považská Teplá, which is about two hours drive from Bratislava. The school offers one-day, weekly and special courses conducted by trained climbers, and supplies all climbing equipment. Training takes place in Manín Canyon, or on an artificial climbing wall in bad weather.

Government opens elections to scrutiny of foreign monitors

After months of speculation as to whether foreign observers would be invited to monitor Slovakia's national elections, the government of Premier Vladimír Mečiar decided on August 18 to extend an official invitation to the Organization for Security and Cooperation in Europe (OSCE).The OSCE wasted little time in getting its mission started, holding a press conference on August 20 to announce that some 100-150 observers from approximately 20 countries would be attending the September 25-26 elections.The election mission is officially being organized by the Warsaw-based Office for Democratic Institutions and Human Rights (ODIHR), which works under the wing of the OSCE. Head of mission Kare Vollan said that the aim of monitoring is to assess the election process in comparison with international standards, not to resolve clashes on the Slovak political battlefield.

Quest for the elusive Legendary Bača

Florian Šavrtka, a shepherd by trade, was born, raised and will die in the Revúca Valley of Slovakia's Veľká Fatra. At 61 years of age, he resembles a character from the film Grumpy Old Men. But he'd never fit the part, with his jovial personality and eagerness to tell a good story.Šavrtka's grandparents left Slovakia for the US in 1910 because they couldn't find work. They wound up "somewhere in America," where his grandfather worked in a coal mine. They returned to Revúca after the Second World War. Šavrtka quit school at age 10 to work fulltime at sheep herding with his dad.Even these days, the life of a Slovak shepherd (bača) is no picnic. The day begins at 4am with the first milking session. They herd the 346 sheep (and two goats) into a pen with a row of four stalls on one side. Šavrtka, Gustav and Juraj (his two assistants), and Pavel (the shepherd) take one stall each and call the sheep in individually for milking.

Unemployment rate eclipses 14.1% in July

Unemployment in Slovakia crossed the 14% barrier in July, according to figures released on August 20 by the National Labour Office. In some regions of the country, such as southern Slovakia's Rimavská Sobota, the number of jobless soared over 30%.While the first half of 1998 brought increased unemployment rates in 65 of 79 Slovak regional districts, the latest figures show an alarming jump from 13.5% at the end of June to 14.1% as of July 31. Because of changes in the way the numbers are tabulated, Labour Office officials said the latest results could not be compared to previous years.

"Slovak Gold"

Not cowed, media promise full election coverage

David defying Goliath he is not, but Andrej Hryc is determied not to be intimidated by the media restrictions in Slovakia's new election law."We won't change one syllable of our news coverage and commentary," said Hryc, director general of Rádio Twist, one of the main private alternatives to the state-owned Slovak Radio. "However, we cannot boycott the law, we do have to follow it."The new law, passed in May 1998, contains strict guidelines on how Slovakia's electronic media may cover September's national elections. At first, the country's domestic opposition as well as the US government and the EU warned that the media clauses would bias news coverage during the campaign period in favour of the government. But with a month to go before the national vote, most of the country's independent press and electronic media have vowed to report on politics and parties as usual, even at the risk of incurring large fines.

SNS mistrusts foreign investors

Ignác Prno, economic adviser to the Slovak National Party (SNS), wants to distance his party's policies from those of its government coalition partner, the HZDS of Premier Vladimír Mečiar. After four years of close cooperation, Prno said, "the coalition wasn't and isn't united on economic issues," especially on the questions of privatization and foreign investment.Given the junior partner role of the SNS, Prno continued, the party could not be held responsible for the current state of the economy. "The SNS was allowed to act just as a younger brother to its older brother - the HZDS," he said.But in ducking responsibility for the past, the SNS has not shirked planning for the future. Prno, who is also the vice-chairman of the Office of State Material Reserves, explained that "this government drowned while trying to carry out its decisions.