08 Mar 2019, 18:00 PM

STA, 8 March 2019 - Slovenia ranks high among EU member states in terms of the proportion of women in senior management positions. However, even as the rate is increasing, it is still far below targets set a few years ago.

Data released by Eurostat ahead of International Women's Day indicate that almost half of managerial positions in Slovenia are filled by women (47%) and one in four senior executives is female.

This places Slovenia fifth among EU member states, with EU average at 36% and 17%, respectively. The data take into account positions in public and private sectors.

While still above EU average, Slovenia is not among the leaders when it comes to the percentage of women on board members of publicly listed companies, which is at 27%, only a percentage point above EU average.

02 slovenia female executives eurostat.png

Similarly, data from the European Institute for Gender Equality show that the proportion of women in senior positions in largest listed companies in Slovenia is increasing.

The proportion of women CEOs, executives and non-executives in such companies rose to 24.7% in 2018, the highest in recent years.

Commenting on the figures, the Manager Association said that this was still far from the target of 40% by 2020, set in a EU directive proposal in 2013 by the then Justice Commissioner Viviane Reding.

The association has been advocating legislative changes to improve gender equality in top corporate positions, pointing to surveys showing companies with gender-balanced managements perform better.

This is also evident from the the Women in Work Index, a survey conducted by Pricewaterhousecoopers, where Slovenia gained one spot to place 4th among the 33 OECD countries.

Consultancy Bisnode has surveyed 18,300 businesses whose chief executives are women, finding that while those represented 25% of the economy, they generated 37% of total revenue and 39% of total profit in 2017, employing 37% of the workforce.

The analysis also showed above-average efficiency of "women businesses", having turned one euro into almost 1.3 euro of profit, which compares to the overall average of 0.9 euro.

Melania Seier Larsen, executive director of Boston Consulting Group and vice-president of the women manager section at the Manager Association, noted disparity between women university graduates and those in senior positions.

"Women represent as much as 58% of graduates, but then there are only 20% women executive directors and only 5% of women are chief executives," she said.

Trends in science are similar; while about as many women as men graduate or even win a PhD degree, the proportion of women as they pursue their careers to regular professorship drops to 17%.

Larsen noted that gender inequality in decision-making positions was huge, quoting World Economic Forum in projecting that at the current pace it would take 100 years to close the gender gap.

The full report, in PDF form, can be found here

08 Mar 2019, 14:30 PM

STA, 7 March 2019 - Slovenian banks recorded a cumulative net profit of just over EUR 496m in 2018, the highest since the pre-crisis year 2007 and an increase of almost 17% over the year before on the back of robust growth of non-interest revenue.

Whereas net interest revenue rose by just 3% to EUR 672m due to persistently low interest rates, non-interest revenue surged by over 14% to EUR 482m, shows a central bank report released on Thursday.

The figure confirms earlier findings that banks have been increasing service fees to offset low interest rates.

The sector also profited from the cancellation of provisions for non-performing loans, though that contributed only EUR 48m to the bottom line, a tenth more than in the year before.

Operating costs increased only marginally, by 0.6% to EUR 700m.

Total assets increased by 2.2% to EUR 38.78bn, in what is the second consecutive annual increase.

Non-banking deposits were up 5.3% to almost EUR 30bn, mostly due to a EUR 1.2bn increase in household deposits.

Loans to the non-banking sector grew at a rate of 3.3% on the back of robust lending to households, which now account for a quarter of total outstanding loans.

Asset quality improved last year as banks reduced exposure to non-performing loans to 4% from 6% measured by the broad definition of the European Banking Authority.

Despite the rapid improvement, the share of non-performing loans to the corporate sector remains high, at 8.4%. This is however a 4.5-point improvement on the year before.

All our stories about Slovenia and banks can be found here

07 Mar 2019, 18:00 PM

STA, 6 March 2019 - The Chamber of Commerce and Industry (Gospodarska zbornica Slovenije - GZS) has proposed a reform of the pay system in the corporate sector for 2019-2025 centred around tying wage growth to productivity gains, echoing its long-standing position that pay should be more performance-based.

Under the proposal unveiled on Wednesday, average gross wages would increase by nearly a quarter by 2025, provided that annual productivity gains almost doubled compared to 2014-2018, from 2.7% to 4.8%.

The goal of the proposal is to increase value added per employee to EUR 60,000 and exports to EUR 50bn. In that case, the average gross wage would be EUR 2,000, GZS director general Sonja Šmuc said.

Slovenia's exports amounted to EUR 31bn last year, the average private sector gross wage was at EUR 1,647 in December, whereas value added per employee was EUR 43,000 in 2017, the latest year for which data are available.

"Assuming appropriate productivity gains, the average gross wage could rise by EUR 370," GZS chief economist Bojan Ivanc said.

Related: Find out the average pay for various jobs in Slovenia

To achieve the required productivity gains, Slovenia has to step up investments in research and development and improve vocational education, according to Šmuc.

At the same time, wages in the public sector must grow at a slower pace than private sector pay, and the retirement age must gradually converge towards the EU average.

"It is time to talk about this now, not when we already have major problems funding pension," Ivanc pointed out.

The GZS has sent its proposal to all social partners and will now try to reach a consensus. Negotiations are expected to start next week.

Meanwhile, employers and trade unions have voiced reservations about the proposal. An exception is the ZSSS, Slovenia's biggest trade union confederation, which believes the goals could be reached.

Marjan Trobiš, the head of the Employers' Association, expressed surprise that the proposal was presented as having the backing of the entire business sector.

He said that his association had only gotten the text yesterday and had not yet had the chance to become fully acquainted with the document. He is also surprised that negotiations are to start as early as next week.

Igor Antauer, the secretary general of the Trade Crafts and Small Business Employers' Association, said that the proposal had not yet been coordinated among employers.

"It's a shame that somebody was in a hurry ... and that they did not check what would happen to all segments of the private sector not just the industries represented by the GZS."

Pergam trade union head Jakob Počivalšek said that the document was not aiming to raise salaries but to limit them and enable higher pay for managers.

Počivalšek said he was not against investing in R&D and training, but that the proposal provided no guarantees that this would actually be the case and the funds would not be spent on higher pay for top managers.

Lidija Jerkič, the head of the ZSSS, is not as critical. "These goals are nothing new. They can be reached but will require a restructuring of the industrial sector." She added that it was high time to reach an agreement on private sector pay.

06 Mar 2019, 15:04 PM

STA, 6 March 2019 - Mercator needs to be excluded from the indebted Agrokor group and transferred to the new Fortenova Grupa as soon as possible, Agrokor's crisis manager Fabris Peruško has told the STA in an interview. The process has its own dynamics, he said, adding that it could be completed by the end of the year.

Peruško has been responsible for the winding down of Agrokor since February 2018, he will also head the new Fortenova Grupa which will be launched on 1 April to bring under one hat Agrokor's successful subsidiaries.

Meanwhile, the insolvent companies will remain part of Agrokor. The process of transformation will start with Agrokor's companies in Croatia, while those based in other countries will be included once the process is completed in Croatia.

On 1 April, 32 solvent Croatian companies will become part of the new group, while the 45 Croatia-based insolvent companies, which will remain part of Agrokor, will each get their own "mirror company", which will also be included in the Fortenova Grupa.

The names of the new companies will be made up using their original names and the word plus, said Peruško.

The third group of companies includes Croatia-based companies in which Agrokor holds less than 25% and 82 Agrokor companies based in Slovenia, Serbia and Bosnia-Herzegovina.

"Mercator is in the third group and we want a speedy transfer of assets from the company in receivership, Agrokor, to the more health company, Fortenova. This is also important for Mercator's suppliers, employees and the entire Slovenian economy."

Peruško expressed satisfaction with "fair relations" between Agrokor and Slovenia's Economic Development and Technology Minister Zdravko Počivalšek, as well as with Gregor Planteu, a government-appointed member of Mercator's board.

He believes that it would be advantageous if Planteu remained on the board of Mercator also after the retailer becomes a part of Fortenova Grupa. The transfer of Mercator to Fortenova does have its own dynamics which depends on the Slovenian legislation.

"Certain small Slovenian banks have reservations about the transfer but I believe that the plan contains rational economic arguments and that it must be green-lit as soon as possible because this is in the interest of the banks."

"If the banks fail to support the transfer, Mercator will remain a part of a company that has gone bankrupt. This is in nobody's interest," Peruško said when asked about the potential scenarios for Mercator's future.

The most imminent steps for the plan to be implemented is to get the go-ahead of the Slovenian competition watchdog and resolve issues involving minority shareholders, both of which Peruško sees as mere formalities, which do, however, take a certain amount of time.

When asked whether Mercator could become one of the leading companies of Fortenova Grupa, Peruško said that Mercator, as well as Croatian retailer Konzum, must be viewed in the scope of the group's entire retail division.

Both companies are facing challenges in different markets of the region. Their operations must be optimised to the benefit of the entire group. Peruško underlined that synergies of the two groups must finally become reality.

Peruško, who was not involved in Agrokor's takeover of Mercator in 2014, believes that the Croatian group paid a lot for Mercator. He also said that Mercator was in better condition now than it was before the takeover.

"When it was taken over by overindebted Agrokor, Mercator was not a healthy company and Agrokor provided a much-needed injection that helped it survive."

"The problems started when they failed to build a platform that would make them healthy partners for their suppliers." Peruško said that Fortenova Grupa would abolish certain limitations to allow better partnerships with suppliers.

The Agrokor boss believes that the Slovenian market is too small for Mercator. "I see Fortenova Grupa as a new and healthy platform on which Slovenian suppliers will be able to develop their business."

Fortenova Grupa will start out with a lot of debt: between EUR 1.4bn and EUR 1.5bn. The group expects to generate between EUR 320m and EUR 340m in operating profit. It will moreover sell off business operations that are not a part of its core divisions: retail, food production and agriculture.

06 Mar 2019, 10:10 AM

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.

05 Mar 2019, 12:50 PM

STA, 4 March 2019 - The Slovenian insurance group Triglav collected EUR 1.07bn in insurance premiums last year or 7% more than in 2017, to increase its net profit by 16% to EUR 80.8m, according to an unaudited report published on Monday.

Premium growth was recorded in all insurance markets and segments, the report says, noting that the group's pre-tax profit was up 15% to EUR 97.5m.

The parent company Zavarovalnica Triglav posted a net profit of EUR 65.5m last year, up 5% year-on-year, while pre-tax profit amounted to EUR 78.5m, or 6% more than in 2017.

01 Mar 2019, 12:50 PM

STA, 28 February 2019 - Slovenia's survey unemployment rate stood at 4.4% in the last quarter of 2018, which is the lowest rate since the last quarter of 2008, when it stood at 4.3%, the Statistics Office reported on Thursday.

Among the people aged between 15 and 29, the survey unemployment rate in the last quarter of 2018 was at 7.6%, or two percentage points lower year-on-year. The rate was the lowest in the 55-64 age group, at 3.8%.

The long-term unemployment rate dropped to 1.8% year-on-year, as the number of long-term unemployed persons was down by 35.6%, from 29,000 to 19,000.

In the last quarter of 2018, 45,000 persons were unemployed by ILO standards, which is 14,000 (24.3%) fewer year-on-year. The active population in Slovenia was up by 12,000 (1.2%) to 984,000.

The number of inactive persons was up by 4,000 or 0.6% to 729,000. More than half of them (394,000) were older than 65, while 7% or 47,000 of them were aged between 25 and 49.

More detailed data on this story can be found here, while our stories on employment in Slovenia are here

01 Mar 2019, 11:50 AM

STA, 28 February 2019 - Slovenia's gross domestic product (GDP) was up by 4.5% in real terms last year, preliminary data by the Statistics Office show. The economy expanded by 4.1% year-on-year in the last quarter of 2018.

Compared to the previous quarter, the economy grew by a seasonally adjusted 0.8% in the final quarter. In year-on-year comparison, it expanded by 3.6%.

In the whole of 2018, the seasonally adjusted GDP growth was at 4.6%.

In year-on-year comparison, the seasonally adjusted GDP growth was the highest in the first and third quarters, reaching 5.2% and 5.1%, respectively. In real terms, the economy expanded by 4.8% and 5.0%, respectively.

In the second and fourth quarters, growth reached 4.6% and 3.6%, respectively, according to the seasonally adjusted data, while in real terms it was at 4.1% for both quarters.

Last year's GDP growth figure is in line with the expectations of domestic and international institutions or slightly higher. It is, however, somewhat lower than in 2017, when the economy expanded at a 4.9% rate.

In its autumn forecast, the government forecaster IMAD put last year's GDP growth at 4.4%. The European Commission put it at 4.3% last November, while Banka Slovenije, the central bank, said in mid-December 2018 it should reach 4.2%.

The preliminary estimate puts GDP at current prices for 2018 at EUR 45.948bn, which is up 6.9% from 2017.

The final GDP figures for 2018 are due at the end of August.

Romana Korenič of the Statistics Office stressed at today's press conference that exports still played an important role in the GDP growth but that the role of domestic spending was becoming increasingly important.

In 2018, domestic spending was up by 4.6%, which the highest growth since 2007.

External demand continued to reflect positively on the economic growth although exports grew at a more moderate pace than in 2017. It rose by 7.2% last year, while it up by 10.7% in 2017. Imports, meanwhile, grew by 7.7%, which is 2.6 percentage points less than in 2017.

The external balance of goods and services contributed 0.3 percentage points to the GDP growth last year, which is much less than in 2017, when it added 1.3 percentage points.

Gross investment was up by 12.6%, which is 0.6 percentage points less than in 2017. Gross investment in fixed assets rose by 10.6%, which is level with 2017 (+10.7%).

The pace of growth of investment in fixed assets in construction became more moderate, Korenič, said. It was extremely high in the third quarter, rising by more than 20% year-on-year, but in the final quarter, the growth was only about 12%, which, however, is still pretty high, she noted.

The growth of company investment in machines and transport equipment also slowed down somewhat, while investment in buildings grew by 6%, which is the highest growth since the second half of 2016.

Final consumption increased by 2.3% (by 1.5% in 2017). Household consumption grew by 2.2% and government spending by 2.6%. In comparison, in 2017 government spending was up by a mere 0.5%.

The number of people in employment increased by 3% year-on-year to 1,017,000, which is the highest figure on record, meaning since 1995.

Asked about the outlook for GDP growth this year, Korenič said such forecasts were difficult to make. It is difficult to assess when the cooling down on the global level will reach Slovenia, she said.

Slovenian and international institutions expect GDP to grow at a rate of 3.3-3.7% this year.

More detailed data can be found here, while our stories on Slovenia’s economy are here

27 Feb 2019, 10:20 AM

STA, 26 February 2019 - The Finance Ministry has drawn up changes to tax legislation, reducing taxes on labour on the one hand and increasing the capital tax on the other. It hopes that lower taxes on labour will boost spending and economic growth. Most of the changes would step into force in 2020.

Finance Minister Andrej Bertoncelj told the press in Ljubljana on Tuesday that the main goal of the reform was to increase net revenue of those employed to make the Slovenian labour market more competitive internationally.

This is to be achieved with changes to income tax brackets. The draft changes envisage moving the brackets up, reducing the tax rate for certain brackets, and increasing tax incentives.

The ministry expects this to have the biggest effect on the third income bracket, which the minister said affected the "most productive" part of the society. He said both the proposals of employers and trade unions had been taken into account in the changes.

If only the general tax incentive is taken into account, the net revenue of employees with minimum wage would go up by EUR 32, of those receiving average wage by EUR 144 and of those receiving two average wages by EUR 670 a year.

The taxes on the annual holiday allowance would be reduced. As so far, the allowance in the amount of up to average gross pay would not be taxed, but under the new proposal no social contributions would need to be paid from it either. Currently only the allowance that matches 70% of the average gross pay is exempt from contributions.

This means that the employee would receive the entire amount paid out by the company if it did not exceed average gross pay. The ministry would like this to be implemented this year.

For performance bonuses, the ceiling for being except from tax, which currently stands at 100% of average gross pay, would be raised to 150% in 2020. In 2021, it would be pushed to 175% and in 2022 to 200% of average gross pay.

The ministry believes this would cut the budget revenue by some EUR 270m a year. This is to be offset by an increase in corporate tax in 2020, 2021 and 2022 by one percentage point from 19% to 22%.

Current tax incentives for R&D investment would be preserved, but the effective tax rate for a company could not be lower than 5%. The average effective tax rate currently stands between 12% and 13%, Bertoncelj said.

Changes to capital gains tax

The schedular taxation of certain revenue (capital tax, interest and dividends, and revenue from rents) would stay the same, while the tax rate would be raised from 25% to 30%.

Capital gains tax would still be lowered with time, but to a much lesser extent. While currently it drops to 15% after five years of ownership, to 10% after 10 years, to 5% after 15 years and to 0% after 20 years, now it would stand at 30% for the first 10 years and remain at 15% after 10 years.

In total, these changes would increase budget revenue by EUR 110m a year. The remaining EUR 160m needed to cover the gap would be brought in through more efficient tax collection, and the fight against tax fraud, grey economy and social fraud.

According to the ministry, this is how much measures in these fields brought in last year.

Bertoncelj said he had already presented the blueprint of the tax reform to the coalition informally and was currently presenting it to deputy groups. The coalition is to discuss the proposal at its meeting on 12 March.

The changes are also to be debated by the Economic and Social Council, an industrial relations forum.

The ZSSS confederation of trade unions as well as the Chamber of Craft and Small Business (OZS) and the Chamber of Commerce and Industry (GZS) expressed satisfaction with the ministry's proposal.

In its response the ZSSS noted that it had been fighting for lower labour taxes and higher taxation for the capital, while the OZS underlined it was against a higher corporate income tax. A similar position was also voiced by the GZS.

26 Feb 2019, 12:40 PM

STA, 25 February 2019 - Finance Minister Andrej Bertoncelj told European Competition Commissioner Margrethe Vestager in Ljubljana on Monday that Slovenia remained committed to the privatisation of Abanka. The pair also disused a potential lifting of management restrictions for the NLB bank before the state sells another 10%.


After Slovenia recently sold 65% in the country's largest bank, it is also in the process of privatising Abanka, the country's third biggest bank, by July this year as part of commitments made during the 2013 bank system bailout.

While there have been individual political calls in Slovenia for renegotiating the Abanka commitment, including from Economy Minister Zdravko Počivalšek, Bertoncelj told the commissioner the sale is progressing in an independent fashion and according to the timeline.

The minister said Slovenia had not asked for a postponement or cancellation of the sale.

Commenting on the situation, Vestager said Slovenia's commitments needed to be perceived in a comprehensive fashion and by considering the reasons why Slovenian banks had found themselves in trouble.

She acknowledged Abanka had met most of its commitments and was in much better shape, but added that negative experience with state meddling in corporate management had been a key reason for including the bank on the commitments list.

As regards NLB, the majority of which was sold in an IPO last autumn, Bertoncelj said the sale procedure for another 10% minus one share was proceeding in line with plans.

While the timeline envisages a sale by the end of this year, there is speculation that it will occur in mid-2019.

Vestager confirmed that talks were under way about the possibility of lifting all the remaining restrictions in the management of NLB - leasing services, factoring, the closure of branch offices, and above all the sale of NLB Vita, the bank's insurance subsidiary.

Vestager, who praised the NLB sale so far and the clear signal about plans to proceed, expressed satisfaction that Slovenia was proactive in the talks about the restrictions, but she would not comment further.

Bertoncelj already mentioned a few days ago in Brussels the idea of securing the lifting before the full execution of the sale in exchange for the state freezing its voting rights for the unsold 10%. He said the intention was securing the bank's development.

The Finance Ministry said today that it was proposing lifting the restrictions that presented the biggest burden for NLB's operations and were thereby also hurting the new private owners.

Bertoncelj added that the talks were complex and would take a while, meaning it was not possible to say whether the agreement with the Commission or the sale would occur first.

Meanwhile, the pair also discussed the European Commission's past changes and future reevaluation of rules governing state aid.

Bertoncelj said Slovenia supported changes towards a modernised system of state aid, strived for a further simplification of procedures and greater harmonisations with other EU policies, for instance cohesion policy.

While Vestager welcomed Slovenia's support, Bertencelj noted that Slovenia, having a centralised system for state aid, had no major problems in the transition to the new rules that gave more oversight competences to member states.

He pointed out that Slovenia was one of only five member states without any open claims for the return of illegal state aid.

25 Feb 2019, 13:12 PM

STA, 25 February 2019 - As tourism in the capital is booming and the city is venturing into congress tourism, investors are looking for ways to meet the demands of the market. The latest such project is a new luxury hotel to be built very close to the city centre.

The construction of the hotel, which will be located near the headquarters of the public broadcaster RTV Slovenija in Kolodvorska Street, is expected to start before summer.

The investor, the company Clippus, has estimated the project at EUR 8m.

The approximate locaton of the new hotel

The Neuhaus Kolodvorska building with big glass windows and green terraces will feature 49 hotel rooms and seven luxury apartments.

The seven-storey building will also boast an outdoor pool, a protected parking lot and basement.

See images of the planned hotel, and learn more about it (in Slovene) here

Being close to the city centre, it will offer a view of Ljubljana Castle, a landmark of the capital, said Peter Cesar of the architectural studio Arhitektura 2211, which is designing the building together with the Kosi studio and other partners.

According to Cesar, this will be the first building in Ljubljana where owners or users of apartments will be able to use hotel services such as a 24-hour reception, security, cleaning and maintenance and a restaurant.

Buyers of the apartments will also be able to rent them out as part of the hotel.

The builder Kolektor Koling plans to finish the project at the end of 2020.

The hotel is to be run by Clippus, which has been founded by Iztok Lampič, who runs one of the biggest land surveying companies in Slovenia, Gekom, and Cesar.

The apartments have not been put up for sale yet.

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