Economic news released by SITA on Wednesday, March 7
Nominal Wages with Highest Growth in Industry in First Month
The average nominal monthly wages in January were higher y/y in all selected branches of the Slovak economy. The Slovak Statistics Office reported that nominal wages grew the most in industry, where they rose 11.9 percent. Nominal wages rose 10 percent in the telecommunications sector, 9.4 percent in the construction industry, 9.3 percent in the sector of real estate, rental, trade activities, and other services, 8.4 percent in the car sales and maintenance sector, 6.8 percent in transport, 5.7 percent in the retail sector and 1.7 percent in hotels and restaurants.
Construction Output in Slovakia Up almost 25 Percent y/y in January
In January, Slovakia's construction industry output increased by 24.1 percent y/y to SKK 8.874 billion. In addition to favorable winter weather, this development was also influenced by a lower comparison base of construction output in companies with twenty and more employees. The Slovak Statistics Office informed SITA on Wednesday that construction output reported 17.6 percent y/y growth in December 2006.
Employment in Industry Increased 4.9 % over January
In January 2007, employment again grew most in the motor vehicle sale and maintenance sector where y/y increase of 17.6 percent was reported. According to the Slovak Statistics Office report, the number of employees also rose in the retail sector where a 7.4 percent was registered. In the wholesale sector it went up 6.2 percent and 6 percent in hotels and restaurants. The increase accounted for 5.6 percent in construction, 2.2 percent in real estate, rental and other public services and 2 percent in transport. For the first time since December 2005 more persons were employed also in industry where the increase accounted for 4.9 percent. Unemployment continued decreasing in the telecommunications sector and postal services as well. The telecommunications sector reported a decline of 7.5 percent and in postal services it was 0.7 percent.
Prices of Motor Fuels Except LPG Moderately Grew as of March 1
As of March 1, the average retail price of 95-octane petrol increased SKK 0.60 to SKK 35.76 per liter compared with February 20, the Slovak Statistics Office informed SITA on Tuesday. The average retail price of 98-octane petrol jumped SKK 0.51 to SKK 38.53 per liter. The average retail price of one liter of diesel was SKK 36.07, up by SKK 0.30. The average retail price of LPG dropped eighteen hallers to SKK 20.89.
Industrial Output Up 17.5 Percent y/y in January
Growth rate of industrial output in Slovakia almost doubled from 8.9 percent y/y in December to 17.5 percent y/y in January. Behind the growth was a 24.6 percent increase in industrial manufacturing. On the other hand, electricity, natural gas and water production and distribution was 15.2 percent lower than a year ago, and mining and mineral extraction decreased by 3.1 percent y/y, according to preliminary figures published by the Slovak Statistics Office on Wednesday.
Sales in Industry Grew 34.4 Percent Y/Y in January
Sales in industry in Slovakia recorded a strong y/y growth in the first month of this year, reported the Slovak Statistics Office. They went up 34.3 percent y/y in fixed prices to SKK 166.5 billion in January. A 36.8-percent increase in industrial manufacturing sales was largely responsible with production of transport means showing the highest sales growth of 110.2 percent, followed by production of chemicals, chemical products and chemical fibers (up 41.6 percent). Sales for electricity, natural gas, and water production and distribution increased 39.2 percent and sales in production of machinery and appliances not classified elsewhere went up 37.9 percent. Sales in wood processing and production of wooden goods grew 36.2 percent.
Retail Sales Up 0.9 Percent y/y to SKK 30.8 Bln. in January
Retail sales in Slovakia in fixed prices grew 0.9 percent this January compared with the same month of 2006 to SKK 30.8 billion. The Statistics Office reported that the growth chiefly resulted from an 18.3 percent growth in retail sales of pharmaceutical goods and cosmetics. Retail sales in other specialized outlets grew 3.6 percent, while retail sales in other non-specialized outlets where food products do not prevail went up 0.4 percent. The growth rate decelerated as a result of lower retail sales outside outlets, going down 8.2 percent, and retail sales in specialized and non-specialized outlets selling food products went down 1.9 percent.
Slovak Telekom Halts Drop in Fixed-Line Revenues Last Year
Former fixed line monopoly Slovak Telekom, a.s. (ST) reported total revenues from fixed lines of SKK 15.824 billion last year, which is a decrease of 1.2 percent y/y. "We find this a very good result. We achieved this figure chiefly thanks to growth in revenues from the internet and wholesale services," said company's President Miroslav Majoros. Revenues of mobile operator T-Mobile Slovensko, a.s. were higher than revenues from fixed lines for the first time last year. They amounted to SKK 15.965 billion and the whole Slovak Telekom group thus posted consolidated revenues of SKK 30.5 billion. "We have been expecting the revenues of T-Mobile to exceed the level of fixed-line revenues for three years already and, therefore, we find it a success that it happened only last year," said Mr. Majoros.
Slovakia to Become 27th Member of International Energy Agency
PARIS, March 7, (SITA) -- The International Energy Agency (IEA) has invited the Slovak Republic to become its 27th member country. At a regular meeting today in Paris, the Agency´s Governing Board approved the accession request of the Slovak government. "Once the Slovak Republic's accession becomes effective, the number of IEA member countries will increase to 27," reads Wednesday's statement by IEA. The Slovak Republic formally applied for accession to the IEA´s founding document on 9 February 2007. Poland remains the only other current candidate for membership in the IEA.
Slovak Telecom Presents its Plans and Expectations for This Year
The dominant fixed-line operator Slovak Telekom (ST) expects changes in reference offers for access and interconnection with its network in 2007. The firm is also to present its reference offer for renting circuits, company's president Miroslav Majoros stated on Wednesday. The telecommunications market also anticipates continual strong demand and growing penetration of broadband Internet mainly in the sectors of households and small-sized companies. "Within the field of fixed lines we intend to focus this year above all on the growth of revenues from non-voice services. We would like to compensate the fall in revenues from classic services related to fixed lines with growth in this area and with investments in the development of broadband Internet," Mr. Majoros further said.
Total Telecommunications Market Sales in 2006 were SKK 62.2 Bln.
Total sales of the Slovak Telecommunications Market reached SKK 62.2 billion in 2006. The share of the dominant fixed-line operator Slovak Telekom in these results reached 51 percent. Sales of the mobile operator Orange Slovensko constituted SKK 38.5 percent of total sales and alternative telecommunications operators registered the remaining 10.5 percent. Slovak Telekom presented these figures based on its own results and the figures of the Slovak Statistics Office and the mobile operator Orange Slovensko. Sales of the telecommunications market in 2005 totaled SKK 58.4 billion and a year before the sales were SKK 53.8 billion.
Cabinet Approves Draft Investment Contract with Samsung Electronics
The Slovak government did not officially confirm the information presented in the media that the South Korean electronics producer Samsung has decided to land its new investment in Slovakia. Nevertheless, the cabinet approved a draft investment agreement on Wednesday between Slovakia and the South Korean company. "The cabinet settled all the necessary issues that the foreign investor required at today's session. It is now up to the investor whether the agreement will be signed," Economy Minister Lubomir Jahnatek announced after the cabinet's session. The minister is optimistic about Slovakia's chances of getting the investment.
Slovakia's Economy Could Overtake Hungary this Year, Thinks Analyst
This year Slovakia could get ahead of its neighbor Hungary in terms of the country's economic performance, claims ING analyst Jan Toth. His opinion is based on Eurostat calculations. Although Eurostat expected that Slovakia would not catch up with its southern neighbor in gross domestic product per capita in purchasing power parity until next year, this calculation did not anticipate that the Slovak economy would grow at such a fast rate. According to Mr. Toth, the European Union's Statistical Office predicted Slovakia's economic growth of 6.7 percent in 2006, while the reality is 8.3 percent. This year Eurostat expects GDP growth in Slovakia at 7.2 percent, while ING estimates that this figure will reach 9.2 percent. "This year GDP per capita in Slovakia could represent 65 percent of EU 25 average or 60.5 percent of the old EU 15 average," adds Mr. Toth. Hungary's GDP per capita is estimated at 63.7 percent of EU 25, which is 59.3 percent of EU 15," he says.
MONEY MARKET: Deep Liquidity Deficit on Wednesday
The interbank market slipped into deep liquidity deficit on Wednesday after the settlement of the National Bank of Slovakia's (NBS) regular two-week repo tenders. A total of SKK 121.901 billion left compared with maturing SKK 75.269 billion. Slovenska Sporitelna's Pavel Janosik stated that commercial banks deposited SKK 5.062 billion in their reserve accounts in the National Bank of Slovakia (NBS) on Wednesday, meeting the March minimum requirement on a cumulative basis at 156.31 percent. The banks borrowed SKK 11.658 billion in refinancing contracts with the central bank.
Railway Network Operator ZSR with 2006 Profit of SKK 10.781 Bln.
Railway network operator Zeleznice Slovenskej Republiky (ZSR) closed last year with a profit of SKK 10.781 billion, which is up SKK 942.3 million over the plan. Total costs amounted to SKK 19.773 billion, which is up SKK 606.8 million in comparison with the plan. Revenues at SKK 30.554 billion exceeded expectations by SKK 1.549 billion. ZSR spokesperson Martina Pavlikova further informed that the better result is related to the fact that the state fulfilled the plan of consolidation function of ZSR. The company was SKK 282.355 billion in the red in 2005. Operating profit improved by SKK 11.063 billion y/y.
FOREX MARKET: Trading Activity was Minimal on Wednesday
The FOREX market registered minimal trading activity on Wednesday. Tatra Banka's Boris Somorovsky commented that the crown's exchange rate stayed at 34.30/34.35 SKK/EUR almost all day long. It later slipped slightly downwards, and before the close of trading, the crown was traded at 34.28/34.32 SKK/EUR. Mr. Somorovsky added that other regional markets also barely registered any movement. Positive local news did not influence the crown either. The crown now does not seem strong enough to improve below 34.20 SKK/EUR. On the other hand, there is no reason for the local currency to weaken over 34.50 SKK/EUR.
STOCK MARKET: BCPB Registers Lackluster Trading
Trading on the Bratislava Stock Exchange (BCPB) was lackluster on Wednesday. Of SAX base titles, only shares from the second issue of OTP Banka Slovensko were transferred. Nevertheless, they did not move the official SAX index, which stayed at 421.71 points. Turnover on the Bratislava Stock Exchange (BCPB) went down from SKK 8.608 billion on Tuesday to SKK 581.322 million on Wednesday with SKK 1.027 million in share trading.
Car Industry Accelerated Industrial Output Growth in January
The growth rate of industrial output in Slovakia almost doubled from 8.9 percent y/y in December to 17.5 percent y/y in January. Behind the growth was a 24.6 percent increase in industrial manufacturing, according to preliminary figures published by the Slovak Statistics Office on Wednesday.