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Business Briefs

NBS to lower minimum reserve requirement again

The central bank will lower the minimum reserve requirement from its current level of 6.5% to 5% of the volume of primary deposits beginning in 2001, NBS Vice-Governor Elena Kohutíková said. She added that the minimum reserve requirement will eventually be reduced to 2%.
Kohutíková explained that the changes fall in line with plans for a further liberalisation of the foreign-exchange regime, Slovakia's opening to foreign markets, and the need for harmonisation with European Union (EU) regulations.
The NBS vice-governor added that the central bank plans no major change in its interest rate or foreign exchange policies next year, adding that there will be less space for a reduction of interest rates next year. However, Kohutíková did not rule out the possibility of a moderate change in rates over the year.


SPPK against Agrokomplex privatisation

The Slovak Agriculture and Food Chamber (SPPK) said December 11 that it was against plans to privatise selected state companies and organisations under the compass of the Agriculture Ministry.
Ivan Oravec, chairman of SPPK, said that the privatisation of the Nitra-based fair organiser and fair ground Agrokomplex only appears to be lucrative. Annual operating expenses of the Slovak agriculture museum on the premises of Agrokomplex are over 11 million crowns ($22,000), out of which only 400,000 crowns is covered from its own profits. The remaining part of the costs is paid from state subsidies and post-tax profit of the business activities of the fair centre, Stanislav Nemec, spokesman of SPPK said. He added that private owners would not be interested in loss-making operations.
The separation of business activities from those focused on the public would create an additional burden on the state budget. The Agriculture Chamber claims that if Agrokomplex is fully privatised, additional annual expenses from the state budget would amount to 26 million crowns. The state subsidy is now 10 million crowns.


BCPB and RM- System Slovakia negotiate merger

The over-the-counter RM-System Slovakia (RM-S) and the Bratislava Stock Exchange (BCPB) are negotiating a merger. Plans to merge the two operations were part of the revised Stock Exchange Act that stipulates that a stock exchange will be organised exclusively on a membership pattern, said Darina Huttová, general director of RM-S. In its current form, the RM-System will only operate until April 30, 2001.
If it is successful, starting May 1, 2001, the RM-System would transform into a securities trader. The RM-S trading system, Huttová said, can encompass such a transformation, and the current structure of trading offices should remain the same.
If the merger of the RM-System and the BCPB fails, the RM-System will apply for a stock exchange licence and become a competitor to the Bratislava Stock Exchange. Because of the lower liquidity and the small Slovak capital market, such a possibility is risky for both parties, Huttová added.


Construction industry reports 11.7% growth

Output in the construction industry reached 7.2 billion crowns ($14 million) in October, up 11.7% year-on-year, the Statistics Office said. In the third quarter of this year, output in the construction industry grew year-on-year.
The growth in October came on the back of an increase in output in new construction, reconstruction and modernisation of 17.9%, and repairs and maintenance (1.9%).


Compiled by Ed Holt from SITA

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Gilden: Take the negative and make a positive from it Photo

The works of New York native, photographer Bruce Gilden, who has worked for five decades in the streets of the biggest cities, are on exhibit in the Kunsthalle (House of Arts) in Bratislava.

Bruce Gilden: Feast of San Gennero, Little Italy, 1984.