Business Briefs

Fico offered seat on SPP privatisation commission
Economy Ministry flaps over Aligator exhibit
Central bank lowers key interest rates
Parliament moves law on parks to second reading

Fico offered seat on SPP privatisation commission

Prime Minister Mikuláš Dzurinda has offered opposition Smer party leader and independent parliamentary deputy Robert Fico a seat on the working commission for the preparation, coordination, and control of privatisation of state monopoly gas distributor Slovenský plynárenský priemysel (SPP).
The move came as part of a government pledge to work with opposition parties on such matters. However, Fico has openly said he disagrees with the sale of a 49% stake in SPP without offering at least some part of that - between 10 and 15% of the company - on the capital markets.
The government is currently discussing whether or not it would place some shares on the market. However, analysts have said that the government is more likely to support the sale of the full 49% share in the firm to a single bidder, arguing that only through this will a potential investor be interested in entering the gas company.
They have also said that were Fico to take a seat on the commission, it could endanger investor confidence in the sale and the state's ability to conclude the process quickly, lowering the eventual price it would get for the stake.

Economy Ministry flaps over Aligator exhibit

The Economy Ministry said March 22 that it would investigate how the Slovak-made 'Aligator' armoured vehicle came to be on an arms fair exhibition stand in the United Arab Emirates presenting defence hardware of the German firm Rheinmetall DETEC.
A batch of 'Aligator' vehicles, produced originally by the Martin, central Slovakia, firm Transmisie under licence to Slovak firm ZŤS Defence, had been exported to Germany only for modifications, Economy Minister Ľubomír Harach said. He added that a licence had been granted only for the export and immediate re-import of the vehicles straight to Slovakia.
"We therefore have to investigate how the vehicle finally turned up in Dubai," said Harach.
ZŤS has attacked the German firm for what it called "unauthorised use of another firm's property" and the subsequent leaking of classified information and unauthorised provision of vehicle documentation.

Central bank lowers key interest rates

The Bank Board of the National Bank of Slovakia (NBS) March 23 lowered key interest rates by 0.25 percentage points to 6% p.a. for one-day sterilisation operations, 9% for overnight refinancing operations and 7.75% for standard two-week repo deals.
The decision was based on favourable macroeconomic developments this year, which have been evolving in line with NBS forecasts, bank officials said after the cuts, noting that current price developments were more favourable than central bank expectations, partially as a result of slower growth in food prices as well as other tradable goods.
They also said that a decrease in the year-on-year rate of underlying and core inflation indicates a shift in price development towards the lower limit of NBS prognoses. For the next few months, the NBS expects moderate growth in the year-on-year rate of both underlying and core inflation mainly because of a growth in food prices and a jump in consumer prices as a result of an increase in power prices for corporate entities. However, the positive influence of competition in the retail sector and relatively low consumer demand should continue to curb major price fluctuations, the bank believes.

Parliament moves law on parks to second reading

Parliament advanced the cabinet-proposed draft bill on support for the establishment of industrial parks to a second reading March 23 with several MPs saying they plan to propose an increase in the level of financial support for municipalities establishing industrial parks from 70% to 80% of projected infrastructure costs. They added that they would like to see a rise in the sums allocated in the state budget for this support from the current 500 million Slovak crowns ($10 million).

Compiled by Ed Holt from SITA

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