Business News


Builders Want Govt to Help Salvage the Sector

Ljubljana, 26 January (STA) - Building subcontractors are urging the government to take action as the wave of bankruptcies and debt settlements in the construction sector is threatening to wipe out smaller players.

"Help us, or hundreds will go belly up," Mirko Pozar, the chair of the Association of Subcontractors at a division of the Chamber of Commerce and Industry (GZS), told the press on Wednesday.

Big builders which are in trouble owe subcontractors and suppliers between EUR 400m and EUR 500m. "Builders are facing collapse," said Branko Selak of the GZS's Construction Chamber.

GZS general manager Samo Hribar Milic labelled the current situation in the construction sector as indicative of the state of the entire economy, saying that only this year will the economy "hit the bottom".

The builders want the government to act, including by suspending corporate income tax for three years for suppliers and subcontractors with heavy exposure to troubled builders.

They are also seeking a partial break on payroll taxes and subsidised interest rates on loans, Pozar said.

The government has also been called upon to kick-start major infrastructure projects and help builders win deals abroad.

In early January the government adopted a set of measures to help struggling builders, including the launch of major infrastructure projects such as power plants and works on the Slovenian rail network.

Smaller builders in particular are being targetted with EUR 20m that will be allocated for insulation of elderly homes and schools.

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