Slovenian CFOs Expect Slower Growth, Concerned About Taxes, Wages, Employment & AI

By , 06 Mar 2019, 10:10 AM Business
Slovenian CFOs Expect Slower Growth, Concerned About Taxes, Wages, Employment & AI Montage: JL Flanner

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STA, 5 March 2019 - Slovenian chief financial officers (CFOs) expect a somewhat less positive outlook of the state of the economy this year, and point to operational cost management and lack of trained workers as the main risks to business, according to the 2019 survey by consultancy services provider Deloitte Slovenija.

 

"The main findings of the survey, which has been carried out for the 10th time in Central Europe and for the 8th time in Slovenia, are that CFOs expect growth to slow down.

"In Slovenia, they stressed that an unstable fiscal or legislative environment in general makes their business highly uncertain," Deloitte Slovenija director Barbara Žibret Kralj said as she presented the survey in Ljubljana on Tuesday.

With the minimum wage to rise in Slovenia, Slovenian CFOs expect labour costs to rise the most among all costs. And just like in 2018, they point to hiring adequately trained staff as one of the biggest problems.

The CFOs also expect the unemployment rate to rise, and see banks as the most popular lenders, with internal sources of funding also playing an important role.

Mojca Osolnik Videmšek from the Gorenjska Banka bank said the economy was deeply in an investment cycle, so the need for banks as sources of funds, also because of low interest rates, was there to stay.

This year's survey also focused on artificial intelligence.

More than three-quarters of CFOs in Central Europe and around 40% in Slovenia say their companies lack the support of artificial intelligence in decision-making processes.

In Slovenia, two-thirds of companies say artificial intelligence is important for the development of financial services, but are poorly prepared for implementation.

Slovenian CFOs also believe artificial intelligence will create many jobs in the medium term, but a quarter maintain it will make many jobs obsolete in the long run.

While firms compete globally to attract IT experts, Juri Sidorovič from Deloitte said directors not giving clear instructions and not setting goals was sometimes a problem.

"The problem is what a goal is, what we want, what can be modernised, what can be robotised," he stressed.

Deloitte Slovenija also commented on the tax reform presented last week, with Andreja Škofič Klanjšček saying it was more of a "correction since it brings no major changes".

She welcomed the planned changes to personal income tax to finally take the pressure off of those in the middle of the income scale, and exempting holiday allowance from all taxes.

However, Škofič Klanjšček is worried about the planned rise in corporate income tax from 19% to 22% and about the minimum taxation of 5% of all legal entities.

The participants of the news conference said raising the corporate income tax "is a bad signal to attract investors".

They also complained about the lack of a strategy in which the government would set goals to be achieved with tax changes.

Sidorovič said the state could for instance decided to promote IT and then take measures to implement such a strategy.

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