Ljubljana, 18 January (STA) - Participants of Monday's panel on the future of the Slovenian economy, featuring Economy Minister Darja Radic, agreed that the state should create a stable environment for businesses as there are enough potential strategic investors.
Radic told the panel organised in Ljubljana by daily Dnevnik that the key problem of the Slovenian economy was considerable indebtedness of companies and the credit crunch, which is holding back recovery.
Acquiring fresh capital will be the key. "The question is whether there is enough such capital in Slovenia or whether it is necessary to get capital elsewhere. There will probably be a combination of both."
According to Radic, if Slovenia does not create a favourable business environment, companies will seek it elsewhere. "This has to be done because we are small, because we all know each other," she said, adding that Slovenia needed input of foreign know-how in management.
The process of injecting capital in state-owned banks NLB and NKBM is taking too long, said the minister, while the director of the Securities Market Agency Damjan Zugelj added that many things would be solved with the immediate listing of NLB.
Chairman of retailer Mercator Ziga Debeljak meanwhile noted that Slovenia was lacking ambition and entrepreneurial spirit and that creating a good business environment was the responsibility of the state.
"Traditionally, economic growth in Slovenia has been fueled by investment and foreign demand. The strong recovery abroad is good news for us, but we have to be prepared."
The president of the board of directors of the SKB bank, Cvetka Selsek, added that state-owned banks in need of fresh capital should get it immediately. Otherwise, the state should list the banks or look for new owners instead of waiting.
Stojan Petric of industrial group Kolektor meanwhile believes that those responsible for indebtedness should provide the capital injections in struggling companies. "Looking for loans in banks and supporting ineffective companies will not bring us out of the crisis."
Marko Jaklic of Ljubljana Faculty of Economics said that the public and the state had been too tolerant of risky management buyouts. He now expects a serious strategy which would prevent companies falling victim to MBOs. "This government needs a strategy of timely response."
Branko Drobnak, the boss of the insolvent financial group Poteza Skupina, called for the establishment of a bad bank.
According to him, economic growth in Slovenia could be generated only by higher exports. Slovenia's problem is that companies have not been restructured; some sectors are uncompetitive because their value added is absolutely too low.