STATEMENTS by PM Robert Fico about price regulation, expropriation and critical statements on the subject of energy companies have until now gone unaswered abroad.
However, it is now possible to hear the first voices criticizing his ideas. PM Fico has recently proposed to foreign shareholders of the gas utility SPP a buy-back of their stakes in the company, the Sme daily wrote. He has informed them that if the profit of several billion crowns is too little for them and they want to profit more on Slovak households, the Slovak government would buy back their shares. The shareholders turned down the proposal.
The Fitch Ratings agency published on September 11 an analysis saying that “political pressure” has been increasing in the regulation of energy prices since the general elections in 2006. According to a SITA quote from the Fitch Agency, this might negatively influence the value of energy suppliers by worsening their access to finances during times when they will require significant investments to replace or modernise ageing facilities.
US Ambassador to Slovakia Vincent Obsitnik also emerged as a critical voice regarding some statements and actions of the Slovak government. At the Central-European Business and Social Initiative conference, Obsitnik highlighted that Slovakia is “interesting for investments, because the business environment here is attractive for current as well as new investors”. On the other hand, he indicated that there are some signals which do not contribute to the development of business making.
“Measures such as nationalisation or price control certainly do not belong among measures positive for businessmen,” said the ambassador.
Anton Marcinčin, an economist with the World Bank, does not take these expressive statements by PM Fico seriously.
“These are the statements of a politician and they should be taken politically,” he said. Marcinčin thinks that the government communicates with energy monopolies in a different way than how it is portrayed in the media.
“Those statements are part of a communication in front of the public which does not seem to be significant,” Marcinčin said. He assumes that the government communicates with these monopolies also unofficially and “here it is about something different”.
The World Bank economist believes that Fico’s statements would not scare away investors interested in Slovakia.
“They will be rather curious to see what law enforcement in Slovakia is, whether invoices are settled in time and whether it is possible to get public orders without bribes.”
“There are more significant problems that various stances, which are only a smokescreen and the media pay them too much attention,” he said.
22. Sep 2008 at 0:00 | Compiled by Spectator staff from press reports