22 Mar 2019, 10:20 AM

STA, 21 March 2019 - IMAD, the government's macroeconomic forecaster, has downgraded Slovenia's economic growth forecast for this year by 0.3 points in real terms to a still robust 3.4%, citing weaker export demand. Growth is projected to slow further next year, to 3.1%, IMAD said on Thursday.

The forecast marks a significant slowdown from the 4.5% growth rate that Slovenia recorded last year according to preliminary estimates, but it remains strong and is still well above the projections for the eurozone as a whole, which is expected to grow by well under 2% this year.

The revised budget for 2019 that the National Assembly passed in a re-vote yesterday assumes growth will stand at 3.7% this year.

IMAD forecasts that export growth will slow by over two points compared to last year to 5.1%, before ticking up slightly to 5.3% in 2020. As a result, the net contribution of foreign trade will be close to zero.

Private as well as government spending are expected to offset the weak exports, the forecast suggests.

Household spending growth is projected to remain strong and above last year's level (2.9% this year and 2.4% in 2020), with government spending expected to grow at a slightly slower pace of 2.2% and 1.9% respectively.

Investment spending will weaken substantially, on the other hand, with growth projected to slow to 7.7% this year and 7% in 2020 compared to low double-digit rates recorded in the last two years.

Job creation will continue, albeit at a slower pace: having hovered around 3% in the previous years, employment growth is projected to slow to 2% this year and 1% in 2020.

IMAD says job gains will be affected by the continued decline of the working-age population as the population as a whole ages.

Inflation will remain moderate and below 2%, the forecast suggests.

IMAD lists several risks that could affect its projections, among them a disorderly Brexit, US protectionism, and slowing growth in China.

The Chamber of Commerce and Industry (GZS) also revised its economic outlook for the economy downwards today. It now projects a 2.9% growth for this year, a deterioration of 0.6 percentage points on its previous forecast. The growth is to slow down to 2.2% next year.

The GZS attributed the downgrade to a slowdown in export markets. "Private consumption growth remains high, as does investment growth," it said.

The growth of merchandise exports is expected to decelerate to 4% in 2019 and to just 2% in 2020. "The projection is guided by rather weak confidence in manufacturing and a major restraint when it comes to new orders."

Household consumption is expected to grow at 2.4% this year. "We expect consumption of non-durable goods (cars, household appliances, home equipment) to slow down somewhat and the savings rate to slightly increase."

Nevertheless, the chamber upgraded the domestic spending forecast for 2020 to 2.1% due to cuts in tax on pay announced by the government.

The GZS's outlook is based on the presumption that the risks of trade wars, China's hard landing or a no-deal Brexit would not materialise.

All our stories about the Slovenian economy are here

21 Mar 2019, 07:00 AM

STA, 19 March 2019 - The Koper port transships the biggest share of Austrian imports and exports, with the number of containers increasing by nearly six times over the course of the past decade, port operator Luka Koper said in a press release following a meeting with Austrian business representatives on Tuesday.

Luka Koper holds a 33% market share in Austria, transshipping 7.1 million tonnes of various goods. Luka Koper has been the top port for the Austrian economy for the last eight years, according to data provided by Verkehr, an Austrian logistics journal.

Good cooperation and good rail connections are key factors in this, Luka Koper said, adding that it had established daily rail links with Austrian logistics centres.

There is a container rail link with Graz ten times a week and there are multiple links a week connecting the port with the logistics centres in Villach and Enns. Moreover, 75% of cargo headed to or coming from Austria is transported by rail, the company said.

Today's get-together of Austrian executives and Luka Koper representatives featured representatives of 26 Austrian companies focusing on logistics, transport, IT solution and construction.

19 Mar 2019, 16:15 PM

STA, 18 March 2019 - The group around postal operator Pošta Slovenije generated EUR 250.7m in net sales revenue last year, according to unaudited report, which is 5% more than in 2017. Expenditure was also up due to the expansion of business, but the group still posted a net profit of EUR 10.4m, up EUR 1.5m from 2017.

In recent years, the postal and monetary services divisions have been decreasing. Last year, they were down by 4% and 10%, respectively, CEO Boris Novak told the STA on Monday. Meanwhile, other services offered at post offices saw a 5% rise, he added.

Since the market is expanding, especially in on-line sales, there is more packages and priority mail. Growth was also recorded last year in logistics services and the supply chain.

Despite its legal obligation of also providing conventional postal services, Pošta Slovenije has been adapting to the changes on the market by developing its network for package delivery, supply and logistics, Novak said.

Last year, postal services accounted for 86% of all net revenue, 8% was generated from money transactions and 6% from other services.

The biggest revenue growth was recorded in the segments packages and logistics services, which accounts for almost a fifth of all services.

Pošta Slovenije allocated EUR 25m for investment last year. One of its major projects is the multi-year project of modernisation of its logistic centre in Ljubljana, which last year cost EUR 11m.

It is not clear yet how much of last year's profit will got to the state budget. Last year the owner took EUR 4m and just as much the year before.

But one thing is certain, future business results of the national postal operator will be affected by the agreement which was recently signed with trade unions. The measures introduced this year and the next have been estimated at EUR 17.7m.

This year, the postal operator expects net sales revenue of EUR 251.5m and a profit of EUR 12.3m.

Pošta Slovenije has been mentioned as one of the bidders for the logistics company Intereuropa now held by banks. Novak would not comment on this, but he did confirm that packages and logistics were the two main pillars of Pošta Slovenije's operations.

Through PS Logistika and Feniksšped, the group is already conducting logistic services in the markets of SE Europe and wants to increase its activities in these markets, he said.

14 Mar 2019, 11:50 AM

STA, 13 March 2019 - The association Counselling Office for Workers said on Wednesday that some Slovenian companies, including several large ones, were blackmailing workers from abroad. Most often they demand that the worker reimburse the company for the costs of obtaining their working permit if they leave the company earlier than agreed.


Such a demand is usually included in the worker's employment contract or a special agreement.

Goran Lukić and Goran Zrnić of the Counselling Office for Workers named two companies making such demands, the builder CPG VG and the elastomers and thermoplastics company Siliko.

A contract with CPG VG says that the employer covers the costs of obtaining a working permit for the worker and the costs of their national professional qualification. But if the worker quits their job in less than three years, they must pay EUR 1,500 to cover these costs.

Similarly, Siliko makes a special agreement with its workers stating that the cost to the company for obtaining the working permit for the worker is EUR 500. If the worker quits their job, they must reimburse the company for the sum and any other possible costs, the agreement reads.

The Employment Service responded by saying that under an agreement on the employment of Bosnian citizens in Slovenia these costs must be covered by the employer, so such agreements were "inappropriate or in fact a violation of Article 9 of the agreement".

Lukić also pointed to a ruling by the Koper Labour Court in a similar case involving the company Retrans which says that such deals run contrary to the constitutional right of workers to pick their employer freely and are as such null and void.

All out stories on employment in Slovenia are here

13 Mar 2019, 16:00 PM

STA, 12 March 2019 - The UK-based company Ascent Resources has announced it will appeal against the Slovenian Environment Agency's decision that it will have to seek an environmental impact assessment (EIA) for its gas extraction project in the far north-east of the country.


"The partners plan to appeal the decision within the prescribed 15-day period," the UK company has said as quoted by Your Oil and Gas News portal.

The key ground for appeal will be that all six expert government agencies which the agency is required to consult as part of the screening assessment process concluded that no EIA should be required on the basis that the project to re-stimulate two currently producing wells was not likely to have significant effects on the environment.

The Slovenian Environment Agency (ARSO) failed to follow the findings even though bound to so, having not undertaken any independent assessment of the likely impacts of the environment, Ascent Resources said in the post.

Ascent Resources has been extracting and selling untreated natural gas from the Petišovci field in cooperation with its Slovenian partner Geoenergo, but the partners have been unable to get permits for hydraulic fracturing and for a new gas processing plant due to repeated appeals by environmentalists.

The company said that the partners had applied for the screening assessment in May 2017, so they also plan to challenge ARSO's latest decision for not being issued within the two-month period prescribed by Slovenian law. "The failure to comply with other provisions of Slovenian law as well as breaches of EU law will be detailed in the appeal."

Related: Ascent Resources CEO - Company May Sue Slovenian Government Over Fracking Permits (Video Interview)

Meanwhile, Ascent Resources welcomed ARSO acknowledging that the proposed project cannot be regarded as "fracking" as defined by the European Commission in its recommendation in 2014.

Ascent Resources has been working with legal experts in Slovenia and London to prepare claims for damages as "a result of the numerous and continued failures and delays by ARSO and the ministry to comply with Slovenian and EU law".

It said that "any potential claim for damages will take into account the amount invested by Ascent in the project, currently in excess of EUR 50m, and future expected profits from the development of the field which is estimated to be a multiple of the existing investment".

Related: PM Surprised By Hunt Lobbying for UK Fracking Company: “In Slovenia We Operate in Line with the Law”

13 Mar 2019, 14:26 PM

STA, 11 March 2019 - Slovenian companies have started to feel the impact of a downturn in car sales which has followed on the heels of several years of growth. Moreover, cars have become more expensive last year, as the industry had to adapt to new environmental standards that took effect in September.


In general, the number of new cars sold in the EU last year was still higher than in 2017. It went up by 0.1% to 15.14 million new cars.

However, the sales have been dropping since September. Volkswagen, the biggest car maker in Europe, saw its sales drop by 6.5% in January, while Audi saw a decline of 17% and BMW's sales went down by 2.7%.

In Slovenia, car sales went up by 2.7% in 2018 over 2017. However, the number of new cars registered in January was 4.6% lower than a year earlier. Moreover, prices went up by an average of 5% last year, the business newspaper Finance reported recently.

Experts believe that the decline in Europe was caused by a change in emissions testing brought about by new environmental standards in September. The month before, car sales went up by nearly 33% as buyers were offered considerable discounts.

In China as well, sales are going down. The country saw a 3.5% drop last year, which was the biggest decline in new car sales since 1990.

The situation still seems a bit more optimistic in the US, where sales have gone up due to economic growth and low oil prices. However, analysts expect the trend to reverse this year.

Buyers have also started to opt against diesel engines. In the EU, diesel engines made up only 34.1% of all newly registered vehicles in the final quarter of 2018, 7.1 percentage points less year-on-year.

On the other hand, the share of new petrol engines increased by 4.9 percentage points to 57.2%

The number of electric cars and plug-in hybrids has also been on the rise. Last year 2.1 million new alternative-fuel cars were sold globally in 2018, exceeding the two million mark for the first time.

Global downturn of car sales is likely to continue also due to urban ride services providers such as Uber and the increasingly popular concept of car sharing, which is especially popular in cities.

In Slovenia, Avnt2Go is the biggest car sharing service provider. Its services are available in Ljubljana, Maribor, Kranj, Murska Sobota and the Jože Pučnik Airport Ljubljana, the country's biggest airport.

It has a fleet of 200 cars, which it intends to expand by another 100 by the end of the year.

The downturn in car sales is already being felt by Slovenian car parts makers, such as Boxmark, a company sewing car seat covers for several European car makers.

"Last year already brought a slight drop. We expect this to continue and become more pronounced in the second half of the year," Boxmark boss Marjan Trobiš has told the STA.

The company is prepared for the downturn, according to Trobiš. It has expanded its assortment of products so as to branch out into aviation. Among other things, it signed a six-year contract with the Emirates airline.

Currently, the company is taking in enough orders but if the pessimistic forecasts come true, this will affect the company's work force, according to Trobiš.

Dani AFC, a Slovenj Gradec-based leather company servicing the car industry, has meanwhile abolished a third shift, creating 100 redundancies.

All our stories on business and Slovenia are here

13 Mar 2019, 06:34 AM

STA, 12 March 2019 - Exports by Slovenian companies amounted to EUR 2.7bn in January, which is 13.7% more than in the same month in 2017, while imports stood at EUR 2.6bn, a 8.7% year-on-year increase, the Statistics Office (Statistični urad Republike Slovenije, SURS) reported on Tuesday.


The trade surplus amounted to EUR 120.9m, the highest January surplus on record. The exports-to-imports ratio was 104.7%.

Slovenia's exports to EU member states amounted to EUR 2.05bn, up 8% year-on-year, while exports from the EU rose by 3.3% to EUR 1.91bn.

02 slovenia imports exports jan 2019.JPG

Surplus in trade with the EU countries was at EUR 140.1m, or one-third more than in January 2017. Exports to the EU represented 75.6% of total exports and imports represented 73.7% of total exports.

Exports to non-EU countries surged 36% in January to EUR 660.4m, while imports from outside the bloc increased by 27.2% to EUR 679.6m.

A deficit of EUR 19.2m was thus recorded in trade with non-EU countries, the Statistics Office said.

More details can be found at SURS, while all our stories on business and Slovenia are here

11 Mar 2019, 16:15 PM

STA, 8 March 2019 - Sava Re, Slovenia's second largest insurance group, generated a record profit of EUR 43m in 2018, an increase of 38.3% on the year before as gross written premiums rose by 5.6% to EUR 546.3m.


The core company Sava Re saw its profit increase by 27% to EUR 41.87m, while gross written premiums decreased by a percent to EUR 151.6m.

Releasing the results on the web site of the Ljubljana Stock Exchange, the company said that 2018 saw a relatively low incidence of large claims, which was reflected in the group's improved performance.

"Profitability was also supported by the synergies from the merger of four insurers now under the unified brand of Zavarovalnica Sava and the better performance of the group's non-EU-based members," the release said.

Chairman Marko Jazbec told the press that 2018 was a "record year and a very successful for the entire group," with both plans for 2018 and results from 2017 having being exceeded.

Jazbec added that the management was especially proud of the record group profit, and the "exceptionally high return on equity, amounting to 13.1%."

The growth in group premium was generated by expansion in non-life insurance business in Slovenia (up 10.9%) and outside it (12.5%) and a 17.8% growth in life insurance business abroad.

The volume of collected gross premiums in the group, which also has subsidiaries in Croatia, Serbia, Montenegro, Kosovo and North Macedonia, last year exceeded the planned by 5.1%.

The reinsurance segment saw 7.2% less in gross written premium as a result of strict underwriting discipline and selective underwriting.

As anticipated, there was a drop of 2.9% in gross life insurance premiums written owing to a large number of policy maturities.

"When it comes to reinsurance on the global market, we were relatively conservative from the aspect of assuming new risks, so we recorded a drop in premium, which is partly also a result of the fluctuation of the US dollar compared to other currencies," said Jazbec.

Operating revenue of the group was up by 9.8% last year, which in addition to the growth of gross premiums by the existing companies was also a result of the operations of the new companies included in the group in 2018.

The group finalised three takeovers last year: the North Macedonia-based pension company NLB Nov Penziski Fond, which was renamed Sava Penzisko Društvo; the Serbia-based insurer Energoprojekt Garant, which was merged with Sava Re's Serbian non-life insurer at the year end; and the Slovenia-based assistance service provider TBS Team 24.

Sava Re has also signed agreements on the acquisition of three further companies; the transaction involving two Croatian ERGO companies was finalised in February and the one involving KBM Infond slated for closing later this year.

Investors on the Ljubljana Stock Exchange have responded to the record results, with the Sava Re share adding 2.35% to EUR 17.40 around noon.

The dividend proposal from the management and supervisory boards will be known in April, when the AGM will be called.

Jazbec said that "dividends will certainly not be lower than last year," when Sava Re paid out a total of EUR 12.4m in dividends to its shareholders, or 80 cents per share.

Regarding the plans for 2019, Jazbec reiterated that net profit was expected to increase by another 10%, while collected premiums were planned to exceed EUR 555m.

You can find all our stories about business in Slovenia here

11 Mar 2019, 11:37 AM

STA, 8 March - Young Slovenian businessman Damian Merlak, who has made more than 100 million euro with last year's sale of Bitstamp, one of the world's largest crypto currency exchanges, has bought four run-down hotels in the Alpine valley of Bohinj, north-western Slovenia, for 8.4 million euro.

Merlak bought Zlatorog Hotel, Bohinj Hotel, Bohinj Apartment Hotel and Ski Hotel Vogel, at excellent locations near Lake Bohinj, from businessman Zmago Pačnik and his family, news portal Siol reported on Friday.

While it did not report how much Merlak paid for them, business newspaper Finance said the deal, involving the purchase of three firms managing the hotels, was worth 8.4 million euro.

Back in 2016, the Pačniks wanted to sell them for 15 million euro, putting the highest price tag of seven million euro on Zlatorog Hotel, which needs the most repairs.

Merlak told the STA he had bought the hotels to renovate and re-launch them. The ones being leased will continue to operate in the same way, while the rest will be managed by his team after renovation.

He also noted the 43-room Zlatorog Hotel, located above the lake and closed since 2011, would be the most demanding project.

It is not only in an extremely poor condition, having been stripped bare over the past few years, "but also unsuitable for 2019 in terms of design", he added.

The value of its renovation will depend on which of the variants architects are working on is chosen, but "I'd be very happy if Zlatorog is ready for use in two years' time".

Bohinj Hotel, situated by the lake, has 20 rooms and 34 suites. Bohinj Apartment Hotel with 27 self-catering units is said to be in a state similar to Zlatorog's.

The 28-room Ski Hotel Vogel is located some 50 metres from the ski slopes on Mount Vogel above the lake.

According to Siol, the hotels used to be managed by the Alpinum company, which the state sold cheap to the Pačnik family in 2002.

The Pačniks had been leasing them and invested practically nothing into them, so the Bohinj municipality had urged the state to take measures to save them from ruin.

For Merlak, the hotels are not his first investment in Bohinj. In 2016 he bought the Tuba self-catering units near the well-known Savica waterfall.

Even before that, he and his former Bitstamp partner Nejc Kodrič bought several farms with 1,300 cattle. He also bought a veterinary clinic.

All out stories on blockchain and Slovenia are here

08 Mar 2019, 20:00 PM

STA, 8 March 2019 - Prime Minister Marjan Šarec told the weekly Mladina that UK Foreign Secretary Jeremy Hunt had raised the issue of a UK company's gas extraction project in the north-east of Slovenia during their talks in Ljubljana at the end of February. Šarec said he found the manner of inquiry unusual.

The fracking attempts in the Petišovci area were stopped by former Environment Minister Jure Leben after UK company Ascent Resources had been pressuring the country to issue an environmental permit and even threatening with a lawsuit before an EU court.

Several environmental NGOs and parties had also accused UK Ambassador Sophie Honey of lobbying and putting pressure on Slovenian authorities to secure the permit for fracking.

Šarec said in an interview with Mladina that the case had come up in the talks with Hunt in Ljubljana on 21 February.

Asked whether Hunt had lobbied during the talks, Šarec replied in the affirmative. "Yes, his questions regarding this case were, I must say, unusual.

"I believe that such talks do not become a foreign secretary, because it makes the whole thing resemble horse-trading."

Šarec said he had told Hunt that "in Slovenia we operate in line with the law."

"I'd like to point out that the permit for fracking is not a matter of a favourable political stance toward this or other party but a matter of legislation.

"I am also personally convinced that these procedures for extracting oil or gas undoubtedly entail certain environmental risks."

Šarec also noted that lobbying was usually reported to the Commission for Corruption Prevention but it this case this was not necessary, because he had publicly spoken about it now.

All our stories about fracking in Slovenia can be found here, while all our stories about Jeremy Hunt are here

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

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