Archive of articles - January 1999, page 4

Spare a kind word, Congress

Over the past four years, the U.S. often criticized Prime Minister Vladimír Mečiar's government for what State Department officials termed a "democracy deficit." In 1999, seemingly, that deficit will be shored up by the new government of Prime Minister Mikuláš Dzurinda, for which the U.S. has already stated a preference. Dzurinda and his colleagues may have good reason, then, to be disappointed that the holy grail of NATO and EU membership seems to be receding before their outstretched hands.The U.S. and its allies have long used NATO membership as a carrot to encourage Slovakia to reform. At its Madrid summit in May 1997, NATO decided to exclude Slovakia from the first group of former eastern bloc states to join the alliance, but U.S. State Department Spokesman Nicholas Burns told the Mečiar government that this decision might be reversed if the Slovak government took "concrete steps to pass a minority language law, and give opposition members greater representation in intelligence, media, and privatization committees."

Political grip on judges relaxed

Justice Minister Ján Čarnogurský is under heavy fire from all quarters these days. After refusing to support his own cabinet's programme on November 23, he was accused by his coalition mates of trying to destablise the government and destroy the ruling SDK party. And after threatening to recall General Prosecutor Michal Vaľo, he was pilloried by the opposition HZDS party for conducting a personal vendetta.But there exists a strong current of professional support among the nation's judges for Čarnogurský's work as Justice Minister. Čarnogurský has sent positive democratic signals by letting judges elect their own leaders, judicial experts say, and deserves credit for improving the independence of the judiciary.

Slovak Telecom becomes joint stock company

New VSŽ president vows to stabilise firm

Gabriel Eichler, the new president of Slovakia's largest industrial company, steel maker VSŽ Holding, told journalists on December 18 that his biggest task over the next six months would be to stabilise the crisis-wracked giant. He admitted, however, that the company's every step would be dogged by a special bank committee set up to oversee VSŽ operations."My main role will be to stabilise the situation at VSŽ and to achieve the so-called stand-still agreement between VSŽ and the banks, as well as among the banks themselves," Eichler said. "This agreement will chart the further course of the company and its use of finances, while it will bring a promise from the banks that they won't use their rights [to recall outstanding loans with VSŽ] written into financial and loan contracts."

Slovak sugar beet harvest worst in two decades

The Holy Goat

ZSNP prepares joint venture with Amcast

Paper mill's profits rocket in 1998

Slovakia's largest pulp and paper producer, SCP Ružomberok a.s., said on January 4 it intented to invest more than 1.6 billion Sk ($43.29 million) this year, after investment of some 3.1 billion Sk in 1998."SCP continues allocating sizeable investments to its main operation, to increase the quality of its production...to maintain its competitiveness with the leading European producers," the company said in a statement. SCP has a five billion Sk investment programme which includes the reconstruction of one of its paper processing machines and ecological investments."For the year 1999, the company's draft plan puts overall investment at more than 1.6 billion Sk," the statement said.

U.S. Congress visits

When the largest Congressional delegation to visit Slovakia since it gained independence five years ago meets the new government in Bratislava on January 12, it will be meeting a cabinet which has tied its political fate to accession to NATO and the EU. And while no member of the delegation will be making concrete promises about accession, both sides are acutely aware of the fact that the visit represents a crucial show of support for the policies of the new government.Benjamin Gilman, the chairman of the International Relations Committee, will be leading the delegation of 12 members of the House of Representatives as they meet with Prime Minister Mikuláš Dzurinda, Parliamentary Speaker Jozef Migaš, and other government leaders.

Fitch IBCA downgrades Slovakia's rating

Three days before Christmas, international rating agency Fitch IBCA became the third major agency to downgrade Slovakia's rating in 1998. Government officials and economic analysts predicted, however, that the Fitch announcement would have little effect on the nation's borrowing ability, and that Slovakia's reputation would improve once an austerity package announced by the new government started to take effect."Fitch was only following the crowd," said ING Barings senior analyst Martin Barto, referring to ratings downgrades by the Moody's and Standard & Poor's agencies earlier in 1998. "We had a meeting with Fitch representatives on November 25, and the downgrade came so soon after the formation of the new government [on October 29] that it does not reflect strongly on the new cabinet's policies."

Ruhrgas wants to buy SPP stake in Czech gas companies

KDH champions Catholic causeChristian Democrats anger coalition MPs

After years of alienation under the former government of Vladimír Mečiar, the Slovak Catholic church has finally found a saviour in Justice Minister Ján Čarnogurský's Christian Democratic Movement (KDH). As the strongest member party in the ruling Slovak Democratic Coalition, the KDH renewed its call in December for three proposals that guarantee the supremacy of the Catholic order in Slovakia: an official treaty with the Vatican, the foundation of a Catholic university and equal funding for state and church schools.The KDH proposals were originally dropped from the government programme in November at the insistence of the former communist SDĽ party, causing Čarnogurský to withdraw his support for the document. But with 65% of Slovaks claiming the Catholic faith, the KDH proposals have since found new ears in the governing coalition.

1999 state budget sets sober fiscal, tax goals

According to preliminary figures released by the Finance Ministry, the state budget for 1999 will set lower targets for both income and expenditures than its 1998 predecessor, and is counting on a 15 billion Sk ($417 million) fiscal deficit. Economic analysts say these modest goals are a welcome sign that the state is serious about tightening fiscal policy after the excesses of the Mečiar administration.Finance Minister Brigita Schmögnerová presented an outline of the budget at a press conference on December 29. Budget income is projected at 175 billion Sk ($4.86 billion) and expenditures at 190 billion Sk ($5.28 billion). Budgetary revenues for 1998 were 177.8 billion Sk, while expenditures were 197 billion Sk.

Slovnaft increases fuel prices by 0.9 Sk per liter

Regional currencies switch to Euro

The demise of the 11 European currencies and the launch of the euro single currency could spur interest in emerging market currencies as players could hunt for alternative trading opportunities in the future. However, the switch will make no fundamental difference to emerging economies, and last year's emerging market meltdown crushed most investor' appetite for risk.Some analysts, however, see selected opportunities in central Europe, and the frontrunners for EU membership could feel the benefit during the year. The Polish and Hungarian financial markets experienced quite active trading during the first days of the 1999. Poland has ushered in the biggest change, dropping the old five-currency basket and adopting a new basket of 55% Euro and 45% dollar. Hungary has directly swapped Euros for marks in its basket, and the Czech and Slovak crowns have also switched their focus to the Euro.

Junior hockey squad wins bronze medal

Slovak ice hockey registered its greatest result ever when the junior national team stunned the field by finishing third at the Under 20 World Championships last week in Winnipeg, Canada. In a total departure from tradition, the normally slap-happy, defense-deficient Slovaks climbed the ladder on the back of their goaltender.Nineteen year-old goalie Ján Lašák led his team of underdogs to the top of group A with one goal wins over the Czech Republic, Finland and the USA and a 0-0 tie with Canada, before ultimately falling 3-2 to Russia, the eventual champion, in the semifinals.In the bronze medal game against Sweden, Lašák finally got some offensive support, as center Istvan Nagy, 19, scored a hat trick to lead Slovakia to a 5-4 win.

Bratislava's neighbourhoods: the best and worst

Bratislava is far and away the most dynamic of Slovakia's real estate markets, but with its 17 districts, the city can be confusing for newcomers looking for a place to live. The Slovak Spectator asked the directors of two prominent real estate firms in the capital - Martin Holec of Bratislavská Realitná Kancelária and Adriana Litomerická of 1. Národná Aukčná Spoločnosť - to evaluate each of Bratislava's neighbourhoods from a homebuyer's point of view.In general, few places remain to be developed near the downtown core. Holec named an area above the main railway in the Nové Mesto district, "on the sunny slopes of the Small Carpathian mountains," as one of the most attractive spots for new development, but added that here as in the atttractive parklands of Karlova Ves, pressure from environmental groups had so far kept the backhoes at bay.

Slovnaft profits from investments

The Slovnaft refinery in Bratislava enjoyed another bumper year in 1998, investing heavily, expanding rapidly and being named Slovakia's best company by the Business Central Europe weekly magazine in December."Slovnaft is becoming one of the leading refineries in central and eastern Europe," agreed Ivan Chodák, an analyst with CA IB brokers. "Their huge investments into new projects will secure Slovnaft a more effective refining process, and will make them significantly more efficient than either [Austrian refinery] OMV or [German fuel giant] Moll."Slovnaft invested 8.3 billion Sk ($224 million) into modernization in 1998, a sum close to its 1997 investments. Besides its largest investment project ever, the EFPA project (Environmental Fuel Project Apollo), another 25 constructions were completed, said company spokesman Ľubomír Žitňan. 4.8 billion Sk in newly constructed facilities are about to be commissioned, the highest value for one year in Slovnaft's history.

Housing market banks on personal savings in '99

Martin Holec is the president of NARKS - the National Association of Slovak Real Estate Offices. Formed in March 1998, the association seeks to integrate the country's many real estate brokerages, to establish market standards and to advance the interests of the real estate industry. The Slovak Spectator sat down with Holec to discuss the work of his association, as well as the current state of the market.