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Slovak PM wants foreign telecom investor

Prime Minister Mikuláš Dzurinda said in an interview with Reuters on February 19 that the government agreed with a Telecommunications Ministry proposal for a strategic investor for the state telecommunications company, Slovenské Telekomunikácie (ST).
"Our primary aim is to secure the transformation of Slovenské Telekomunikácie in such a way to enable them to develop more dynamically. The road to it should lead either through the privatisation of a package of shares or through an increase in basic capital," he said.


Prime Minister Mikuláš Dzurinda delivered a speech at an International Investment Conference in Bratislava in which he promised to create the kind of business environment that would attract foreign direct investment.
photo: TASR

Prime Minister Mikuláš Dzurinda said in an interview with Reuters on February 19 that the government agreed with a Telecommunications Ministry proposal for a strategic investor for the state telecommunications company, Slovenské Telekomunikácie (ST).

"Our primary aim is to secure the transformation of Slovenské Telekomunikácie in such a way to enable them to develop more dynamically. The road to it should lead either through the privatisation of a package of shares or through an increase in basic capital," he said.

Either method would involve a foreign investor, Dzurinda said, and the whole process should be completed by the end of the year. He expected the fixed line communications company to remain a monopoly.

"Slovakia is a very small market... That is why I am very cautious about whether we can, in the operating space of this small operator, seek any competition. In the worst case we will impose a law on the regulation of natural monopolies to rein in ST."

The Ministry of Transport, Post and Telecommunication said in January that the government was considering retaining a 34% stake in the state telecom company with the remainder up for negotiation and possible sale.

ST had assets of 41.3 billion crowns ($1.1 billion) at the end of 1997.

In a speech delivered before the interview, Dzurinda also underlined the government's commitment to foreign direct investment generally. "There is no doubt regarding the need for foreign direct investment into the Slovak economy. It is up to us to create the conditions for a business environment in which foreign capital could feel safe and be profitable for the company itself as well as for the state."

He noted the prospect of tax holidays but gave no details.

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