Business News

North-East Slovenia Struggling with Crisis, Official Says

Ptuj, 01 February (STA) - While the world seems to be emerging from the economic crisis, the economic turmoil has only just hit Slovenia's north-eastern Stajersko region in the past months. However, this is also true of the entire Slovenia, believes the head of the Stajersko Chamber of Commerce and Industry Roman Glaser.

The crisis hit with a delay, not only the north-eastern statistical region of Podravje, but to entire Slovenia and the markets of south-western Balkans, Glaser, who is also the CEO of poultry producer Perutnina Ptuj, said an interview with the STA.

The slow recovery on international markets affected Slovenia's top trade partners, including former Yugoslav republics, which in turn affected Podravje.

Preliminary results for 2010 show a slightly worse picture than expected, Glaser noted. Revenue and profit of regional businesses are significantly lower, while the number of the unemployed rose by 5% year-on-year. "But this probably reflects the picture of the entire Slovenian economy," he said.

The worst seems to be over for the car industry in the region, but problems have just started for the construction sector.

"We've tried to tackle the issue top-down. We've invited Economy Ministry officials over to pinpoint the problems...We've presented them the situation, but we have no mechanisms to do anything else," Glaser said about the chamber's efforts.

According to Glaser, companies themselves react very differently to problems. "Some have decided to contact us, while others are not even our members anymore."

However, there are some construction companies which are doing rather well and are even expanding. "This gives us hope that the sector will slowly consolidate when conditions change. But it is clear that things will not get back to they way they were before the crisis for quite a while."

The service sector is also facing difficult times, with revenues decreasing compared to the past years, Glaser added.

On the other hand, the region still has a few flagships, companies which have managed to restructure their market principles and production. Glaser highlighted aluminium maker Impol, electricity companies and his Pertunina Ptuj.

Asked about the prospects for starting a business in Podravje, he said the conditions were not very difficult to meet and the registration was very quick, but finding a good business idea might be a though nut.

"That is why our chamber is organising numerous cross-border meetings with chambers from neighbouring and nearby countries to make business contacts."

Commenting on a recent case of a foreign investor, fX6D Limited, a Cyprus-based producer of 3D movie glasses which was interested in launching production in Maribor but changed its mind due to red tape, Glaser said the slow response of the state in such cases was typical of Slovenia.

Slovenia is still a little bit too reserved and inflexible in this area, he added.

In general, Glaser expects no major changes to the better for this year, "because money remains dearer here than in Europe and there is less of it, while banks, especially foreign banks, are reserved about investments in the growth of Slovenian economy".

Also, the very negative, pessimistic atmosphere which has been taken hold in Slovenia is not helping the situation at all, he added.

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