Putin still not handing Transpetrol over
Although Eonomy Minister Ľubomír Jahnátek indicated that a definite decision on shares in the Slovak oil transporter,Transpetrol, could be taken during his visit to Moscow, this did not happen. Neither did yesterday's talks between Slovak President Ivan Gašparovič and his Russian counterpart, Vladimír Putin, help (Reuters picture). The lack of a decision means that Transpetrol will stay in Russian hands. Its share in the company is advantageous for Russia in supplying Europe, all the more so since the Kemlin has not hid its ambition to gain shares in some European energy concerns. November 8
Inflation low? Brussels doesn't believe us
The Slovak economy has a good year ahead of it, but the chances of adopting the Euro are being looked at askance by the European Commission. According to Brussel's expectations, Slovakia's inflation should top 3,4 percent in the coming period, which would create complications for fulfillment of the Maastricht criteria necessary for entry into the Eurozone. The National Bank of Slovakia's figures however predict that next year's average inflation will not exceed 2,8 percent. The difference is puzzling for Slovak economists, who in no way counted on the 3,4 figure. What is ausing the discrepancy? According to Mária Valachyová of Slovenská sporiteľna, the Commission is probaby calculating with a weaker crown in the coming year. NBS spokesman Igor Barát commented, "Our pognosis comes out of the information and data which we had at our disposal. Since nothing has changed since that time, we have no reason to alter our outlook."
Slovakia, together with the Czech Republic, came in for the criticism from the Euro-commissioner for Economic and Monetary Matters Joaquín Almunia after releasing their economic prognoses. In his opinion, countries "are not reducing their public finances deficits ambitiously enough." In light of strong economic growth and restricted budgetary spending, the Slovak budget should end next year with a three percent budget deficit, also taking into acount pension reform costs. This is in conformity with the criteria for adopting the Euro. According to the Commission however the government must consistently fulfill all its budget measures, and sees a potential risk in increased health-care spending. The public finances and inflation deficit is considered by Almunia as Slovakia's biggest hurdle in entering the Eurozone. "It is going to depend on whether Slovakia adopts further measures, and how the criteria develop," said Almunia. November 7
Brussels versus Bratislava*
2007 2008
GDP growth (%) 7,1(7,2) 5,7(5,7)
Inflation (%) 3,4(2,8) 2,5(2,1)
Public finances deficit (% of GDP) 3(2,94) 2,9(2,5)
Government growth (% of GDP) 31,6(31,9) 31(31,2)
*European Commission estimates; in brackets are the GDP and inflation figures of the National Bank of Slovakia. In the brackets next to the deficit and Government debt are predictions of the Ministry of Finance SR.
Kežmarok the poorest
An inhabitant of Bratislava has at present twice the income of a citizen of Kežmarok. Such is the result of a comparison of the earning power of the richest and the poorest towns in Slovakia conducted by the GfK Agency. The figures for inhabitants of Kežmarok show a monthly income of less than nine thousand crowns.
Accoring to ČSOB analyst Marek Gábriš, a capital city is better off than the rest of the country almost everywhere in the world. "It's the headquarters for institutions, it has the best infrastructure, contacts with other countries, and the fastest economic development ," was his explanation.
The second best performer in turns of buying power was the east-Slovak metropolis of Košice, but the Trnava and Trenčin regions are also developing quickly, due to their investment flows. Districts abutting big towns are also pulled upwards by their influence.
In the first half of the year, the net income of a Slovak household stood at an average of 8 266 crowns per person per month according to the Statistics Bureau. This figure also takes into account children and non wage-earners. November 8
Investment flow slowing
Last year, Slovakia saw a total inflow of property capital and equity capital worth 20,12 billion crowns.
A report on the flow of foreign investment in 2005 and on the provision of investment stimuli presented by the Economics Ministry for inter-ministerial commentary proceedings concluded that this represented a year-on-year drop of 36 percent.
"The lower level of property capital in comparison with last year was partially caused by privatization incomes in 2004, whereas in 2005 the property capital flow was unequivocally unrelated to privatization," was the explanation of the Ministry. Last year investments were mostly directed to industrial manufacturing, wholesale and retail, to the financial intermediation area, and to business activities relating to real estate. November 7