ISRAELI businessmen and officials would welcome more information about investment possibilities in Slovakia, and would like to deepen the already existing business links between the two countries.
"Economic and political relations are good, but there is still a lot of work that needs to be done to bring the advantages of both markets to the awareness of entrepreneurs. Both sides need to work on this," Yossi Peri, minister counsellor for economic affairs from the Embassy of Israel, told The Slovak Spectator.
According to the Statistics Office of the Slovak Republic, Slovakia imported goods worth €16 million from Israel and exported goods worth €17.6 million last year. The numbers have increased year-on-year. While Slovak exports in 2003 ion, imports from Israel were at €15.8 million.
"The trade figures do not reflect the real potential of both countries and we have a lot of opportunities for further improvement. Israel represents a share of less than 0.1 percent of Slovak foreign trade," says official data presented by the economic department of the Embassy of Israel for Slovakia in Vienna.
The most frequently imported commodities to Slovakia are electronics, machinery, chemicals, metal products, plastics, and agricultural products. The main exported commodities from Slovakia to Israel are machines, transport equipment, chemicals, and industrial goods.
According to Peri, there are plenty of fields where companies from both countries could participate: "They are mainly infrastructure, telecommunications, housing, and industrial buildings. Other areas of interest may also be information technology, upgrading industry and military equipment, agriculture, private hospitals, technological centres, and promotion of industrial research and development."
According to the Israeli Embassy, Slovak companies could be interested in participation with Israeli firms in some major infrastructure projects like gas pipe and railway routes that cross Israel.
Israeli officials say that the main incentives that could bring Israeli investors to Slovakia are the 19 percent flat tax rate for corporations and individuals, possible tax break for profit from investments and worker retraining grants, and the good ratio between productivity and cost of the labour force.
According to the embassy, there is at least one Israeli company, Housing & Construction, interested in building Slovak motorways.
Israeli telecommunication companies might be interesting partners for Slovak firms taking part in tenders to modernise and introduce new telecommunications equipment and technologies for the Slovak army.
There are four Israeli companies - Israel Aircraft Industry, Reffael, Elbit, and Magal Industry - that are interested in taking part in the process of facilitating the Schengen border of Slovakia with Ukraine.
Israeli assistance in the upgrade of the Slovak army's equipment could concern mainly MIG 29, MIG 24 helicopters, L-410 airline carriers, and others, says the embassy.
Emphasis on regional development in Slovakia is creating new possibilities for the modernisation of regional airports. Specific plans have already been made in the case of the Žilina airport and Israeli companies have a fair chance of succeeding in the telecom and security fields there.
The embassy also expects new opportunities in financial services after the full implementation of the pension reform in Slovakia.
After 2005, the Slovak people will save half of their pensions on their own accounts and this opens a new market for private pension management from Israel.
The accession of the Slovak Republic to the European Union in May 2004 is a challenge for business partners from Israel.
"No doubt, the EU could bring new aspects to the mutual cooperation between Slovakia and Israel. Israel can provide its experience in production in hi-tech fields," said Peri.
Slovakia now needs to have modern and competitive industrial research and development, and the embassy thinks Israel may be helpful in this area.
The country has experience in establishing the venture capital firm Yozma, and is prepared to share its know-how about creating private venture capital firms for industrial research.
According to Israeli exporters, there are still administrative barriers that keep the potential needs of Slovakia in certain fields from transparency, said Peri. This might worsen conditions for Israeli businesses attempting to penetrate Slovakia.
The embassy mentioned the complaint of the Israeli firm Tadiran Communications, whose contract to supply telecommunication equipment, worth over €50 million, was cancelled unilaterally and without any reason or explanation from the Slovak side.
"We would like to encourage our partners from the Economy Ministry of the Slovak Republic, SARIO [Slovakia's investment and trade promotion agency], and other relevant offices to start discussing real possibilities for economic cooperation with us," said the embassy in its material.
The last visit aimed at developing Slovak-Israeli relations took place in March 2004 when Ehud Olmert, the minister of trade and industry of the state of Israel, came to Slovakia together with a delegation of Israeli businessmen.