Archive of articles - January 2001, page 5

Micro Economy: Little change on the horizon for companies

Despite the fact that the largest Slovak bank, Slovenská sporiteľňa (SLSP) was sold at the end of 2000, there is little hope that the corporate sector will soon see a revival through loans from financial institutions.In general, analysts hold out small optimism for a significant change in the micro economy for the year to come.The main task for 2001 is, according to Ľudovít Odor, an analyst with CSOB bank, a furher cleansing of the corporate sector of those companies which are not able to compete on the foreign market.

This Week

The sorry pantomime of non-cooperation

The people can see it. The press can see it. The government can see it. Members of the coalition can see it. Even the president can see it. Everybody's talking about it.......... cooperation.Unfortunately few people in the places that matter are doing much of it, and certainly not the SDĽ.The president's New Year address, in its own ultimately simplistic way, spelled out a harsh fact for the coalition. Too much internal squabbling is harming the country. Just a few short days before Christmas the SDL effectively put the kibosh on cancelling amnesties for people suspected of involvement in the kidnapping of the then-president's son in 1995.

Optimism over 2000 deficit questioned

The Finance Ministry remained optimistic for the 2001 budget after its 2000 operating state budget deficit came in almost three billion crowns under its planned 18 billion crown mark.Announcing a full state budget deficit of 27 billion crowns January 2 Finance Minister Brigita Schmögnerová explained that deducting exceptional extra-budgetary expenditures, including 8.5 billion crowns for bank restructuring, the state deficit was actually 15.1 billion crowns.

Macro Economy: Government must continue reform programme

Although the coming year promises more significant economic growth than in recent years, many macroeconomists are urging the government to strenghten the country's improving macroeconomic performance with efficient legislation and reforms - reforms which they say the government was reluctant to adopt over the last 12 months.But while important reforms such as public sector health care, social welfare system, agriculture and education should be top of the government's reform list for economic improvement, time is running out to put reforms in place.

Business Briefs

SDĽ coalition steel doubted

Reforms crucial to Slovakia's development are at risk of being continually delayed by internal coalition bickering and in particular, the often divisive stance of the Democratic Left Party (SDĽ) within the coalition itself, according to analysts and many coalition partners. Following a final 2000 parliamentary sessionon December 19 the SDĽ came in for heavy criticism from coalition partners when, critics argued, the party failed to adhere to previous agreements and refused to support the cancellation of amnesties granted by former Prime Minister Vladimír Mečiar to people suspected of involvement in the 1995 abduction of the former President's son, Michal Kováč Jr.The cancelling of the amnesties was designed to show Slovakia as a state determined to bring criminals to justice and rid itself of an image of a country where political friendships over-ruled the need for justice to be seen to be done.

Government stunned by SE Mochovce plans

Stubbornly pursuing its own pro-nuclear energy policy state-controlled electricity utility Slovenské elektrárne [SE] has left government officials dumbfounded after asking several foreign nuclear electricity businesses to invest money into finishing construction of two reactors at the Mochovce nuclear power plant.The invitation to invest in the power station, revealed in late December by the company, runs against the government's stated aim of discontinuing plans for completing the reactors. The government had said that there was no economic benefit to doing so. The Ministry of Economy has made clear that the government would be providing neither direct nor indirect financial help for construction of the two blocks.

Unexpected interest rate cut welcomed

Slovakia's central bank has said it has given a clear signal that it intends to play its part in helping the revitalisation of the corporate sector with an unexpected cut in interest rates at the end of last year.The December 22 announcement that interest rates were to drop 0.25% took the markets by surprise following statements from the National Bank of Slovakia (NBS) at the end of November that there would be no further cuts in interest rates in 2000.The NBS Bank Board lowered interest rates on one-day sterilisation operations from 6.5 to 6.25% p.a., for overnight refinancing operations from 9.5 to 9.25% p.a. and for standard two-week repo deals from 8.25 to 8% p.a.

Top Pick: Alfons Mucha - Art Nouveau Legend

The original and unmistakable lithographs of the great Czech artist Alfons Mucha can now be viewed in Bratislava marking 140 years after the painter's birth.The exhibition, covering two floors of Pálffyho Palác, presents a selection of 120 exhibiting a comprehensive cross section of Mucha's Paris work. The richly decorated, brightly coloured and near life-sized paintings contrast with his few coloured picture studies of human parts or flower details. Also exhibited are photographs documenting his family life and some of the live models from which he drew his inspiration.

IMF delivers warning as WB deal close

The International Monetary Fund (IMF) handed Slovakia a sour Christmas present as it launched a critical attack December 20 on the government's economic policies, just 24 hours after the World bank had said that a deal was close on the provision of a $300 million Enterprise and Financial Sector Adjustment Loan (EFSAL).The loan itself is conditioned on Bratislava's acceptance of an IMF staff-monitoring programme - something Finance Minister Brigita Schmögnerová had originally dismissed nine months ago as 'only for under-developed countries'.