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The Slovenia Times Slovenian Magazine in English Language Autumn Edition 2016, Volume 13, EUR 4.90

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www.sloveniatimes.com

We are in transitional phase with Brexit fears many uncertainties, but things are much better than we think

Mr. Čeferin brings hope of better Olympics: things to come – Who wins when the athletes even for our economy triumph?

Slovenia Investment Inside: Setting the Stage for the FDI Summit 2016


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Editorial

Dear reader, Autumn Edition 2016 www.sloveniatimes.com

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CEO and Publisher Brane Krajnik

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After celebrating Slovenian success at the Summer Olympics, the path of victory continued into autumn. Just a few weeks ago, Aleksander Čeferin was an unknown in global football, but that changed dramatically with his appointment as UEFA President, the most important position in European as well as world football. "Me being President of UEFA shows that Slovenians are capable of big accomplishments, although we are too often riddled with self-doubt", stated Čeferin, who did not doubt himself on the way to one of his biggest achievements and better times ahead for his homeland. The extent of the globally recognised achievements of Slovenes in sport and the role of Olympic medals for the country brand, tourism attractiveness and foreign capital, are shared in this edition of The Slovenia Times. This autumn edition brings you detailed insights about Slovenia’s current investment climate - we asked CEO’s of both Slovene and foreign companies their views and found out the facts and figures. Foreign investment has significantly declined since 2011, however intra-European projects continue to dominate the scene which, underscores that FDI is the world economy’s leading indicator of integration: more goods and services reach consumers through sales by foreign affiliates than through trade alone. It is clear that we are entering a new phase of investment and the situation requires a new approach from all stakeholders - both public and private. It is not about public versus private ownership, but rather about behaving as a responsible owner, one that takes the risks and defines the direction and then ensures the continuity of leadership, without changing leaders and strategies too often. Finding the right balance is no easy task but it is one that we have to embrace. Transparency, the investment proposition, the masterplan and the 4.0 industrial revolution are the buzzwords that characterise the conversations we have had with business leaders and experts. These discussions will be extended at our Foreign Direct Investment Summit – FDI Summit Slovenia 2016 – the only top level business event which, this year, will be held on 6 December. Save the date and join us at the event. At The Slovenia Times, we are always looking to develop our contribution to improving the business environment in Slovenia and we welcome your valuable thoughts, questions, comments and requests, which can be sent to me at brane@sloveniatimes.com. Thank you for your support. Brane Krajnik CEO The Slovenia Times

Autumn Edition 2016 | The Slovenian Times

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Contents Page 4

IN THE SPOTLIGHT

4 Interview: Michael Møller, Director-General of the United Nations Office, Geneva

6 The impact of European (dis)integration on the economy

8 Mr. Čeferin brings hope of better things to come – even for our economy

10 REGIONAL INSIGHT IN ASSOCIATION WITH S&P GLOBAL RATINGS

ECONOMY Page 8

12 Economic overview 13 Autumn forecast: Exports and private consumption will be the key drivers of GDP growth 14 Fraport Aviation Academy at Ljubljana Airport: Perfect location for the development of innovative,

world-class solutions in aviation training 15 Slovenia has become more efficient in drawing EU funds 16 Interview: Alenka Smerkolj, Minister of Development, Strategic Projects and Cohesion 18 Faculty of Economics, University of Ljubljana: The first and only "Triple Crown" international school

in Slovenia and the region 20 Interview: Robert Rose, Chief Strategist, Content Marketing Institute, USA Page 16

21 Interview: Tanja Piškur, Head of Product range management, NLB 22 Chinese Ningbo city businesses and officials visit Slovenia 24 SLOVENIA INVESTMENT INSIGHT 24 FDI Spillover – learning from the best 25 Setting the stage for FDI Summit 33 Interview: Gregor Veselko, CEO Actual I.T. 34 Interview: Joly Raynald, Revoz CEO

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POLITICS 36 Political Overview 37 Dr Danilo Türk: The fate of our planet depends on the sustainability of development pursued by

human beings 38 Bled Strategic Forum 2016: We need to channel our collective energy

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The Slovenian Times | Autumn Edition 2016


Contents Page 40

EUROPEAN UNION 40 Interview: Corina Crețu, European Commissioner for Regional Policy 42 Brexit fears 44 Interview: HMA Sophie Honey, Ambassador of the United Kingdom to Slovenia

GLOBAL PITCH 46 ABC Venture Gates: Bringing the best global innovations to Munich

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INTERNATIONAL BUSINESS PARTNERS 48 TOPIC: What are your associations and possible related activities with "Brand Slovenia"?

American Chamber of Commerce – AmCham Slovenia, British – Slovenian Chamber of Commerce

– BSCC, The German-Slovene Chamber of Commerce and Industry – AHK Slowenien, Advantage Austria, Luxembourg-Slovenian Business Club (LSBC), Italian Trade Agency (ICE), Slovene - Russian Business Club

Page 68

BRAND SLOVENIA 52 Slovenian paradox: Alpine over-achiever held back by under-achieving tendencies 54 Business and education culture: Slovenia has more to offer than its population thinks

EXPERIENCE&LIFESTYLE SLOVENIA 56 Interview: Miha Pogačnik 58 Interview: Dr Taleb D. Rifai, Secretary-General of the UNWTO 60 Ljubljana: Past and Present

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64 Fairy tale in Postojna cave 66 ŠUS Eurofitness – Best sporting offer in town

SPORT 68 Olympics: Who wins when the athletes triumph? 70 EVENT GUIDE

Autumn Edition 2016 | The Slovenian Times

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European In the Spotlight Union

01

Interview: Michael Møller, Director-General of the United Nations Office, Geneva

We are in transitional phase with many uncertainties, but things are much better than we think Prepared by Tina Drolc, M.Sc.

During his attendance at the 11th Bled Strategic Forum, The Slovenia Times spoke to Michael Møller, Director-General of the United Nations office in Geneva. Since the beginning of his career with the UN, Møller has been dealing with the refugee issues in Iran, Mexico and Haiti. He points out that the international community needs to rethink the way it is dealing with migration, which will increase in the future as a result of climate and other changes. Despite the continuous suffering and conflicts in many parts of the world, he believes that on average the human race has never had it better than it is today. 4

The Slovenian Times | Autumn Edition 2016

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European In the Spotlight Union Q 60 million people across the world are displaced by war, violence and environmental disaster. The civil war in Syria has forced 11 million from their homes. Four million have sought sanctuary in Turkey, Lebanon and Jordan, and over one million refugees fled to Europe last year. What have been the UN measures so far? A The number of refuges around the world has increased by 24 percent to 20 million from the previous year. We have 40 million internally displaced people and then we have migrants– almost 250 million migrants and the number is still growing. Although the funding for humanitarian aid continuous to increase, there remains a serious gap between the available resources and the real needs. Bearing in mind this gap, which is also increasing, we have to focus more on prevention to address the root causes of migration. Solving conflicts peacefully is certainly an important element in this endeavor. In addition, we have to make sur that development is more targeted and focused to make sure that all push factors of migration are properly addressed. Effects of climate change, for example, will lead to more migration. Everyone will look for better life conditions when desperate. Today it does not take much to see on your smart phone the conditions people live in other parts of the world. So people in desperate situations will quickly know where to head for, not only for a better life, but also for survival. We have to be prepared for the demographic pressures. We need to deal with it right now at the global level, it is not just a European problem. International solidarity is needed more than ever. The international community must rethink the legal structures and operational structures to deal with migration. This has to be combined with broader concept of preventive policies and actions. Q There are individuals and groups who are abusing the abovementioned global situation for the expansion of extremism and, as we often read, fear then overtakes the freedom and human rights of a fellow man. What is the UN’s approach to prevent the negative global security-policy scenarios? A Today you need to look at security and human rights from an integrated perspective, you cannot look at them any long in separated silos. We live in an interconnected world with its particular challenges. Increasing inequalities and a prevailing lack of trust in the system and our authorities are important characteristics of our society of today. Even in many of the western countries, economic wellbeing has been unequal and has not increased the level of trust. However if you look at the statistics, the human race has never had it better lives than it does today. On average, and despite the many despairing situations in the world, we are healthier, live longer, better educated,

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If you look at the statistics, the human race has never had it better lives than it does today. Last 70 years have been an extraordinary period in the history of the human race with very few wars. communicate and travel more. The last 70 years have been an extraordinary period in the history of the human race with very few wars when compared to previous centuries. The fact that technology keeps us know instantly what happens everywhere gives the impression that things are out of control – of course there are problems, conflicts and tensions that we need to manage. We are somehow between two chairs where: the old governance system at all governance levels is being challenged and the new system is not yet in place. We are in a transitional phase and the feeling of insecurity is prevailing, however things are much better than we think.

Q Do you think that the fourth industrial revolution has the potential to raise global income levels and improve the quality of life for populations around the world? A Yes, I think it does if we manage it properly. We have to make sure that we manage its ethical dimension, how the technology is used and that all people have access to technology so we do not leave others behind. In the next 20 years, 80 percent of today’s jobs will disappear. Of course, new jobs will be created. We do not yet know the nature of many of these new jobs. We have to make sure that humans are at the centre of this technological development. For example, artificial intelligence is moving quite quickly and there has to be an agreement on how we oversee its use. On what ethical criteria will artificial intelligence be part of our life? These are important questions that we have to address now before it is too late – technology is moving at a very rapid pace. Q According to the UN and World Bank, at least 663 million people lack access to safe drinking water and 2.4 billion (40 percent of the world’s

population) lack access to basic sanitation services. How does the UN deal with this challenge? A It is a huge challenge and we deal with it in many different ways; we have a coordinating role and agreements with many different agencies to work on these issues. Where we are lagging is on the preventive side. Look at what is happening along the Nile, Euphrates and in Himalayas. Countries through which these and other rivers cross do not care what is going on with their neighbor further down the river basin and that has to stop! These are major problems that need to be managed because when one country has a problem, we all will face the consequences: No water, no life – where will the people go to? They will go to places with water, to the neighboring region, to the neighboring country, may be also to Europe or to another region to escape hunger. It is obvious that we have a responsibility to prevent such tragedies, also beyond our country and region. We have to find preventive solutions to this and similar challenges through collaborative projects with governments and local communities.

Q From a long-term perspective, is privatisation of water sources sustainable? A Instinctively, I would say no. I think water is a common good; we just need to be much better at its management. Sometimes there may be a need to put a value to it rather than to privatise it – if you pay for water you are much more careful how you deal with it.  PHOTOS 01 Michael Møller's address at Bled Strategic Forum 2016; Photo: Nebojša Tejić/STA 02 Michael Møller, Director-General of the United Nations Office, Geneva 03 UN Human Rights Council in Geneva. Photo: Xinhua/STA

Autumn Edition 2016 | The Slovenian Times

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European In the Spotlight Union

The impact of European (dis)integration on the economy Professor Mojmir Mrak

Faculty of Economics, University of Ljubljana

"In the medium and long run, Brexit will have negative implications for the global political and economic position of the European continent. Politically, Europe is becoming even more fragmented and therefore smaller in a globalised and increasingly multi-polar international environment. As far as economics is concerned, the size of the EU common market will shrink and the intra-EU power structure for the design and implementation of common policies will change. Brexit will also contribute to new uncertainties for the euro area which will have to adjust to the German-led economic governance structure introduced in recent years."

Andrej BoĹžiÄ?

General Manager of Steklarna Hrastnik

"The lack of unity in Europe with regard to the immigration crisis, the growing lack of trust in institutions, debates on countries leaving the EU, as well as increased controls on the Schengen borders, expressions of extreme political views and intolerance toward immigrants from southern countries clearly point to the fact that the process of European disintegration is already in progress. The consequences of European disintegration will undoubtedly include the closing of borders. This will result in impeded movement of people and goods, hindering commercial transactions between companies from different countries. The geopolitical map will show a divided Europe that, although it comprises the major economies of Germany, France and the UK, is nevertheless losing its strategic and competitive position compared to large countries."

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The Slovenian Times | Autumn Edition 2016


European In the Spotlight Union

Toni Balažič

President of the Management Board, Mercator Group

"In my opinion, Brexit is the most distinct proof of disintegration and is simply a consequence of various social, economic and of course, political processes which are in contrast to the idea of Europe as a single market, if I am allowed the latter simplification. In previous decades, economic interest has always been present and prevailing in the background of the arguments for European integration, even though political interest and a long string of chewed-out ideas and goals of enlightenment were pushed to the foreground. Political interest was focused on ensuring progress, democratic postulates but not always competitiveness (and power) in the ever-changing circumstances of global markets. Naturally, disintegration processes are a part of any unification but now the economic interests have completely died out. This is a distinctly short-term political play which has and will continue to weaken Europe politically and economically. A certain political figure has obviously managed to become a part of the theoretical discussions and most importantly, history textbooks. However, they most certainly do not deserve any awards for excellence and achievement. To cover one more aspect that is the common characteristic of the current conditions globally speaking, I would like to point out that we are actually used to populism – it is the lies which are new."

Irena Moro, Director Moro & Kunst Company

The United Kingdom will become the first country in the history of the European Union to withdraw. Essentially, Brexit came as no surprise for me and in my opinion, it is the most important political and market event this year. Just before the Brexit vote I had a very interesting conversation with a London Bullion Market Association representative who represents the key players and their clients in the bullion market and he convincingly told me that the number of gold purchase transactions by banks and individuals had increased strongly. At the time, it was a clear signal that the gold price would increase sharply in the case of a vote for Brexit, which was exactly what happened the day after - the US dollar price of gold increased nine percent and the euro price increased 11 percent in one day. The World Gold Council from London reported record gold purchases by ETFs and central banks in Europe for August. Investors and countries hedge their assets against negative interest rates. Not only gold, the United Kingdom itself became a safe haven. The United Kingdom is slowly returning to its traditions and international links with Commonwealth members. London is traditionally the centre for physical gold trading and therefore, once Brexit happens, we can expect the United Kingdom to become a safe country to store gold, not for private investors, funds and also for central banks. The United Kingdom is becoming more attractive, the source of economic growth. Gold will definitely shine for the United Kingdom; meanwhile Europe will be trying to cope with sluggish economic growth, negative interest rates and the migrant crisis. For this reason I believe that economic and political unity is very unlikely in the coing years.

Nevenka Kržan

Senior Partner at KPMG in Slovenia

"Not long ago it was impossible to imagine that Great Britain could quit the EU, now it is a fact. June 2016 will go down in the history of the European Union as the month that marked a considerable turning point in the European community. It is very well known that uncertainty is the worst possible circumstance in an economy and for capital flow, hence we expect talks between the EU and Great Britain to begin and also conclude as soon as possible. It is crucial that the remaining Europe is politically strong, for only then can it be an equal economic partner for the rest of the world." Autumn Edition 2016 | The Slovenian Times

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European In the Spotlight Union

Photos: Anže Malovrh and ANA-MPA/STA

Mr. Čeferin

brings hope of better things to come – even for our economy Prepared by Jan Bratanič

entrepreneurs, but the deals will have to be made by others." The "others" in concert with a rigid labour market and unstable tax system are the main culprits in Slovenia’s failures to lure more foreign investments. The champion of transition amongst Eastern-European countries, Slovenia lags behind in the ability to attract foreign capital. For instance, in the last five years, Slovakia managed to attract more than EUR 8bn of foreign direct investment (FDI) inflows, Croatia over EUR 9.1bn, a number almost three times higher than Slovenia.

A forgettable brand of an Just a few weeks ago, one could make unforgettable country the case that Aleksander Čeferin was a relative unknown in global football. Yet, all of that changed dramatically with his election to become the President of UEFA, the most important position in European and indeed, world football.

At the time, you could also make the statement that Slovenia is a virtual non-factor in the world or indeed, the European economy or politics. The only difference is that Slovenia still remains in a state of virtual anonymity. But is all that about to change?

Investors will come Čeferin seems to think so: "Me being President of UEFA shows that Slovenians are capable of big accomplishments, although we are too often riddled with self-doubt." Čeferin didn’t doubt himself on his way to one the biggest achievements for a Slovenian sports official, ever. He doesn’t doubt himself now, or the better times ahead for his homeland. "UEFA is one of the biggest European organisations, with great products, a huge capital base and power. A Slovenian at the head of UEFA means more foreign companies will become interested in Slovenia and that means new jobs for the people. I will strive to help pave the way for productive meetings with foreign investors and

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The Slovenian Times | Autumn Edition 2016

Somewhere along the path from independence to the present day we forgot how to promote and differentiate ourselves from others. It is no coincidence that, even in the times of our biggest triumphs, be it in sport or politics, we get erringly named Slovaks – it even happened to Čeferin in some foreign media. Slovenia, with all its natural beauty, charming cities, educated and hardworking workforce, somehow fails to stand out. A year ago it even disappeared from the top 75 world nations as a brand, a list that is made each year by Futurebrand. Why has Slovenian failed so miserably in promoting itself? When courting tourists, Slovenians might be just a little bit too proud of where they live - in a very small, yet extremely versatile and interesting country. When Croatia tries to promote itself, the leitmotif is unequivocally their sea, their islands and the seaside. When Slovenia promotes itself it does so boasting of its mountains, forests, lakes, the seaside, horses, caves and cities. Our strategy lacks focus and therefore something that foreign tourists, searching for their next travel destination, would remember.

And yet, the number of foreign tourists visiting Slovenia grows each year. Last year, foreign tourists generated around 6.6 million overnight stays, a third more than in 2009. A part of this growth can be attributed to the easing of Europe’s economic woes, but surely also to better recognition. Word of mouth "marketing" definitely helps, so do all the positive articles shared via social media, but nothing compares with the exposure Slovenia got and will get in the future with Čeferin as the head of UEFA.

New opportunities A Slovenian winning the race to lead one of the most powerful and prestigious sporting organisations seemed impossible just a few short months ago. Čeferin’s victory, not unlike great sporting feats, therefore had a unifying effect on an otherwise politically polarised nation. "This success is not my own but belongs also to my fellow Slovenians," said Čeferin, thanking his countrymen for all the positive energy during and after the election. But new challenges await, challenges that Čeferin may have different views on than his predecessor who was part of the establishment of the big footballing countries. Čeferin can’t play favourites among the 55 member countries, but he does understand how small and medium-sized football associations work which can benefit Slovenia. Whether Čeferin can really make a difference in bringing new foreign investors to Slovenia remains to be seen, but there is no doubt that he will be good for our football, maybe even bring a match of the highest order such as the UEFA Super Cup, where the Champions League winner takes on the Europa League winner. "Slovenia meets all the conditions for hosting a match like that," says Čeferin and hints that Ljubljana or Maribor could follow Tallin 2018 at some stage in the not too distant future. 

“Me being President of UEFA shows that Slovenians are capable of big accomplishments, although we are too often riddled with self-doubt.”


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Regional Insight in association with S&P

Regional Insight in Association with

S&P Global Ratings Country

Hungary

Czech Republic

Slovak Republic

Slovenia

Period Year

Real GDP growth (%)

Unemployment rate (%)

CPI growth (%)

Net General Government Balance / GDP (%)

2016 2017 2018 2016 2017 2018 2016 2017 2018 2016 2017 2018

2.5 2.8 2.5 2.1 2.0 2.0 3.0 2.7 2.7 1.7 2.2 2.3

5.0 4.9 4.8 4.5 4.5 4.6 10.5 10.4 10.3 8.9 8.8 8.7

0.0 2.0 3.0 0.5 1.4 1.9 (0.2) 1.3 1.5 (0.3) 1.1 1.3

(1.8) (2.5) (2.3) (0.8) (1.3) (1.0) (2.7) (2.6) (2.8) (2.5) (2.0) (1.7)

Hungary On 16 September 2016, S&P Global Ratings raised its long- and short-term foreign and local currency sovereign credit ratings on Hungary to 'BBB-/A-3' from 'BB+/B'. The agency also raised the ratings on the National Bank of Hungary (MNB) to 'BBB-' from 'BB+'. The outlook on both Hungary and MNB is stable. S&P Global Ratings expects GDP growth to average 2.5% over 2016-2019 (versus the previous forecast of 2.0%), while government debt and gross external financing needs to decline further. Hungary has reduced its share of foreigncurrency debt in central government liabilities, while overseeing a fall in non-resident holdings of the Hungarian forint (HUF)-denominated government paper. This exempts Hungary from the risk of future balance sheet shocks connected to any renewed "taper tantrums." Given the commitment by the authorities to lower debt, a marked departure from a 2% of GDP fiscal deficit over 2016-2019, on average, is unlikely. S&P Global Ratings anticipates that the gross general government debt will reduce

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The Slovenian Times | Autumn Edition 2016

gradually to about 70% of GDP in 2019 from 75% in 2015. Policy efforts such as fiscal incentives to boost consumption, the high rate of EU fund absorption and public works schemes to generate employment, have supported Hungary‘s cyclical recovery since 2013. In 2016, S&P anticipates that a continuation of accommodative fiscal and monetary policies (for instance, through the housing subsidy scheme, cuts in personal income taxes and the VAT rate on construction) will support domestic demand and partially offset the dampening effect arising from lower EU fund absorption. In 2017, these measures will continue alongside higher investment activity via higher EU fund inflows and a budgeted loosening of the fiscal stance. Rising employment and real disposable incomes are likely to continue fuelling private consumption growth. The unemployment rate declined to 5% in June 2016 from a peak of 11.2% in 2010. While some of the gains in the labour market can be attributed to public works programs, the job creation in the private sector has also increased. The conversion of household foreign currency-denominated loans into forint loans in 2015 rendered the sector less vulnerable to currency

Net General Government Debt / GDP (%)

Current account balance / GDP (%)

72.6 71.7 70.3 36.4 36.4 36.1 48.7 49.5 50.2 67.2 67.3 66.5

4.3 3.5 3.0 1.1 0.7 0.7 (0.8) (0.8) (0.8) 7.6 7.4 6.9

fluctuations and will gradually free up household precautionary savings. Central Bank programs, such as the Funding for Growth Scheme and the more recent Market-Based Lending Scheme, aim to normalise bank lending, particularly to small and mid-sized enterprises. S&P expects that the phasing-out of the balance sheet levy on banks will improve the health of the sector and its ability to create credit. The base-case scenario incorporates the S&P view that policy efforts, whether through the Central Bank, the state budget or via quasifiscal activities (i.e., through the balance sheets of other public institutions), will continue to underpin Hungary‘s cyclical recovery over the forecast horizon through 2019. Downside risks to the S&P fiscal forecast could arise from further state acquisitions, an expansion of fiscal programs to support a slowing economy, electoral considerations, budgetary spending on large projects such as the PAKS nuclear power project or the materialisation of contingent liabilities – for instance, guarantees to the state-owned, rapidly expanding Magyar Eximbank or Hungarian Development Bank. The stable outlook balances assessment of Hungary‘s ongoing cyclical recovery and steady


Regional Insight in association with S&P headline fiscal performance, over the forecast horizon, against its still high general government debt and unpredictable policy environment. The ratings could come under pressure if Hungary‘s public finances weakened materially, if the agency was to expect a sustained reversal in the declining debt-to-GDP ratio, if contingent liabilities rise rapidly, or if external vulnerabilities build up again contrary to the current expectations. S&P could also lower the ratings if it sees the transparency of key institutions weakening further, especially if the agency anticipated an eventual fiscal risk associated with such weakening.

Czech Republic On 22 July 2016, S&P Global Ratings affirmed its 'AA-/A-1+' long- and shortterm foreign currency and its 'AA/A-1+' long- and short-term local currency sovereign credit ratings on the Czech Republic with a stable outlook. It reflected the Czech Republic‘s diversified and productive economy, stable institutions, and moderate levels of public debt that the government was able to refinance from the domestic market. The agency considered the monetary policy, although subject to imported low inflation, to be still effective, and expected that the Czech National Bank (CNB) would meet its 2% headline inflation target within the 2016-2019 forecast horizon. The ratings were constrained by the Czech Republic‘s lower GDP per capita (USD 17,600 in 2015 and 17,800 in 2016) than its Western European neighbours, and risks to long-term fiscal stability from its ageing demographics. A confluence of supporting factors pushed up real GDP growth to 4.5% in 2015 (expected 4.7% in 2016), the fourth highest growth rate in the EU28. Absent are the factors that fuelled the growth in 2015 (low oil prices, a record year for car producer Skoda, a boost to inventories resulting from changes to the tobacco stockpiling rules), the agency expects growth to average 2% over the 20162019 forecast horizon on the back of continued export growth (though weaker than previously forecast) and increasing domestic demand as households benefit from record-low unemployment (around 4.5% in 2016 and the coming years) and rising real wages. The stable outlook reflects the expectation that firming domestic demand, the Czech government‘s fiscal space, and the CNB‘s monetary flexibility will counterbalance external risks to the Czech Republic‘s open economy over the next few years. Following the British referendum on leaving the EU, the Czech Republic was (as an auto manufacturer) considered, through trade, to be

one of the countries most vulnerable to the effects of the possible Brexit.

Slovak Republic On 29 July 2016, S&P Global Ratings affirmed its 'A+/A-1' long- and shortterm foreign and local currency sovereign credit ratings on the Slovak Republic. The outlook is stable. The ratings are supported by Slovakia‘s low external debt, stable fiscal metrics and healthy growth prospects. Firm domestic demand should underpin average GDP growth of around 2.8% between 2016 and 2019. The ratings on Slovakia are constrained by modest GDP per capita, and persistent structural challenges such as high long-term and youth unemployment (2016 general unemployment rate amounts to 10.5%). Given Slovakia‘s high dependence on exports (more than 90% of GDP in 2015) and large auto sector (about 40% of industrial production and 27% of total exports), there are still risks to growth via the uncertain outlook for external demand, particularly in Europe. The deficit is expected to remain slightly below 3% of GDP in 2016 to 2019. Risks to these fiscal forecasts are broadly balanced. Additional uncertainty has arisen following the elections in March 2016 when the extreme right entered the parliament. In line with the disinflationary trend in the eurozone, Slovakia experienced some disinflation in 2015 and a similar trend is expected in 2016. Cuts in administered prices will prevent inflation from accelerating significantly in 2016. The stable outlook on Slovakia mainly reflects overall balanced risks to domestic economic growth prospects over the next two years and expectations of stable fiscal performance. Following the British referendum on leaving the EU, Slovakia was (as an auto manufacturer) considered, through trade, to be one of the countries most vulnerable to the effects of the possible Brexit.

Slovenia On 17 June 2016, S&P Global Ratings raised its long- and short-term foreign and local currency sovereign credit ratings on the Republic of Slovenia to 'A/A-1' from 'A-/A-2'. The outlook is stable. The upgrade reflects the expectation that over 2016-2019: • The general government debt-to-GDP ratio will gradually fall as authorities reduce the government deficit and draw down on ac-

cumulated deposit assets totalling 18% of GDP in 2015; • Tax-rich domestic demand will continue its recovery, albeit at a slower pace than in 2015; • Policymakers measures to restrict expenditure increases will complement efforts to raise tax collection; • Positive labour market outcomes, both in terms of wage growth and job creation, will persist and in turn support private consumption; • Credit conditions will likely gradually ease as the health of the banking and corporate sectors improves. In 2015, the Slovenian economy expanded by 2.9% on strong export growth. Domestic demand continued its recovery for a second year in a row, growing by 2%. Employment grew in 2014 and 2015 on average by 0.8% and the unemployment rate reduced to 9% in 2015 (and should drop slightly to 8.9% in 2016 and continue decreasing in the coming years). The current account balance posted a surplus for the fifth consecutive year. In 2016, real GDP growth is expected to be lower at 1.7%. This is because public investment is likely to contract this year, as the 2007-2013 EU budget cycle has ended. However, private-sector activity should increasingly pick up over 2016-2019. The stable outlook balances risks arising from Slovenia‘s still high general government debt (82.1% of GDP in 2016); the large, albeit gradually reducing, role of state-owned enterprises; the possibility of complacency in the implementation of reforms; and renewed external uncertainty that could culminate in lower demand from key trading partners on the one hand, against the precautionary cash buffers of the government, totaling nearly 20% of GDP; and the possibility of an upside risk from the ongoing privatisation process on the other.

Sources: Standard & Poor’s Rating Services and Eurostat. Please refer to our website for more information about ratings at https: www.spratings.com/corporates/ Understanding-Ratings-2.html and read our disclaimers at www.standardandpoors.com/en_US/ web/guest/regulatory/legal-disclaimers Copyright © 2015 by Standard & Poor’s Financial Services LLC. All rights reserved. STANDARD & POOR’S and S&P are registered trademarks of Standard & Poor’s Financial Services LLC. Autumn Edition 2016 | The Slovenian Times

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manufacturing production increasing the most. The improvement in labour market conditions and the strengthening of private consumption contributed to further growth in the trade sector and tourism-related services, with tourism once again showing brilliant results with a 13 percent increase in the first half of 2016 from 2015, as the Minister of Economic Development and Technology, Zdravko Počivalšek, proudly underlined. The continuation of the upward trend in economic indicators is questionable due to the expiration, at the beginning of September, of the public-sector austerity package introduced in mid-2013. Within this framework, the digital economy may become the single most important driver of innovation, competitiveness and growth in years to come. This, at least, is what the President of Slovenia, Borut Pahor, claimed during the conference he hosted on the future of Slovenia’s digital economy as part of the Slovenia 2030 project. As was noted during the conference, new technologies also hold potential for manufacturing industries, as digitisation of manufacturing can transform the entire industry. Under these auspices, a delegation of government officials, led by the Deputy Prime Minister and Public Administration Minister Boris Koprivnikar, and business executives toured the west coast of the United States to visit companies including IBM, Cisco, Uber, LinkedIn, Facebook, Google and the space agency, NASA. 

Economic overview Prepared by Valerio Fabbri

The Slovenian Sovereign Holding (SSH) has new management following Marko Jazbec’s resignation in July when Luka Koper’s workers protested against the planned replacement of three supervisors at the port operator. The proposal, which came amid plans for the expensive construction of a second rail track to the port, raised a lot of resistance from in-house trade union members, leaving open the question of a conflict of interest between personal and political interests on the one hand, and the strategic guidelines set for the privatisation process by SSH on the other. If the most important objective of SSH’s operation is to "achieve a level of corporate governance so as to contribute to the achievement of better operating results of companies with capital assets owned by the Republic of Slovenia and SSH", events like that at Luka Koper complicate the work of convincing potential investors that better operating results could be achieved through a more competitive economic system. Jazbec’s resignation brought Lidia Glavina to the helm of SSH, to lead the all-female board with Nada Drobne Popovič and Anja Strojin Štampar, a trend in line with the proportion of women with government portfolios. July saw the United Kingdom’s referendum decision to leave the European Union (EU), bringing with it a great deal of uncertainty about the economic and political situation in Europe. The effect on Slovenia’s economy would be mostly indirect, with an expected decline in economic growth in Slovenia’s main trading partners which would result in lower demand for Slovene goods and services. These consequences are unavoidable for an export-driven economy such as Slovenia, although the Brexit effect has, so far, been negligible. The real economy has, in fact, shown some positive trends with merchandise exports and

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The Slovenian Times | Autumn Edition 2016

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03 PHOTOS 01 Lidia Glavina will lead the all-female board of SSH. Photo: Andreja Seršen Dobaj/STA 02 Bohinj Lake; Photo: Tinkara Zupan/STA 03 Deputy Prime Minister and Public Administration Minister Boris Koprivnikar's address at Microsoft NT conference. Photo: Stanko Gruden/STA


Economy Autumn forecast

Exports and private consumption will be the key drivers of GDP growth The autumn forecast for GDP growth, in 2016 and 2017, envisages a continuation of the favourable economic trends. Exports will remain the key driver of economic activity over the entire forecasting period. Household consumption is also expected to increase significantly. GDP growth dynamics will be marked primarily by government investment related to the absorption of EU funds. Favourable labour market trends will persist but they will be increasingly characterised by demographic change. The key risks to the central scenario arise from the international environment, the risks associated with the domestic situation are less pronounced. The forecasts for GDP growth are 2.3% in 2016 and 2.9% in 2017. Exports will remain the key driver of economic activity and will continue to be fuelled by not only the expected growth in foreign demand, but also competitiveness gains in the tradable sector. Economic growth is becoming broad-based as the contribution of domestic consumption gradually rises. Household consumption is therefore expected to increase significantly in 2016, with a marked improvement in labour market conditions and a high level of consumer confidence, and these positive trends will also continue in 2017. In 2017, higher growth will also be recorded for government investment co-financed by EU funds, where delays and a lower absorption rate than planned will continue to be seen this year. This will have a pivotal influence on the growth of total investment. We also expect further growth in investment in machinery and equipment and a gradual rebound in housing investment growth owing to the continued recovery of the real estate market. The reasons for this increase in private investment, which is now financed by internal and other non-banking sources to a greater extent than in the past, will be similar to those in the last two years. With high capacity utilisation, the growth in private investment primarily reflects the favourable and more stable expectations of businesses, the persistence of low interest rates, strong business performance and the improving ratio of profit to debt. Government consumption will also continue to increase this year and next, chiefly on account of public sector pay rises, a larger number of employees and an increase in some other forms of expenditure, particularly health care. Employment continues to rise, not only in most private sector activities but also in the public sector owing to the relaxation of hiring restrictions. Given the improvements to the in-

dicator for expected employment, employment growth should be significantly higher this year (at 1.9%) than in 2015, with the number of unemployed falling to around 103,000 for the year as a whole. In addition to the further recovery of the economy generally, higher employer confidence in economic growth and increased use of flexible forms of employment will also contribute to employment growth in 2017. In the coming years, the labour market will be increasingly affected by changes in the demographic structure, particularly the contraction of the working population. Nominal growth in average earnings will hover around 2.0% in 2016 and in the next year. Nominal wage growth in the private sector will continue to rise in 2017. In addition to strong business performance, wage growth will also be underpinned by a considerable decline in unemployment. However, owing to the efforts made by companies to maintain competitiveness, wage growth is projected to hover around the level of productivity growth. The public sector wage rises this year are a consequence of the payment of deferred promotions and the elimination of some austerity measures. Growth is forecast to slow this year Although consumer prices will rise, inflation will remain relatively low. In 2016, average consumer prices will remain unchanged, mainly due to the influence of the low price of oil. The impact of energy prices on the total price decline is gradually easing. Core inflation is rising slightly, fuelled by the higher prices of services, while the average prices of nonenergy goods remain unchanged. Given the assumed growth in import prices for oil and commodities in the next year, we expect rises in energy prices, as well as a slightly higher rate of core inflation owing to a rebound in domestic consumption and a gradual closing of the output gap.

The key risks to the central scenario of IMAD’s Autumn Forecast arise from the narrower international environment, particularly the effects of Brexit. Global challenges remain which are partly geopolitical and these are reflected in the uncertainty regarding future migration flows; however, for the most part, these challenges are increasingly associated with the different speeds of recovery of the largest world economies and thus the expected different directions of economic policy actions taken. The risks in the domestic environment are less pronounced and more balanced than in previous forecasts. The prospects regarding the future absorption of EU funds and hence the volume of government investment are particularly uncertain. On the upside, however, an improvement to Slovenia’s competitive position in the years to come could lead to stronger growth in exports and private investment than assumed in the baseline scenario. Upside risks also predominate in terms of final consumption and stem primarily from favourable developments on the labour market.  Institute of Macroeconomic Analyses and Development Autmn in Miklošič park, Ljubljana. Photo: Tamino Petelinšek/STA

Autumn Edition 2016 | The Slovenian Times

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Economy A long-term objective of the Fraport Aviation Academy is to not only to pass on knowledge, but also to link the different areas of aviation into an integrated learning concept.

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Fraport Aviation Academy at Ljubljana Airport

Perfect location for the development of innovative, world-class solutions in aviation training Fraport AG, via its wholly-owned subsidiary Aerodrom Ljubljana, will establish the Fraport Aviation Academy at Slovenia’s Ljubljana Airport by the end of 2016. The academy will include a brand new training centre costing around EUR 3.9m. Construction is scheduled to start in early 2017 and the inauguration is expected in early 2018. Aerodrom Ljubljana has received the corporate mandate to operate the new academy to meet the increasing training and education requirements within the Fraport Group as well as those of external customers. As one of the world’s leading airport management groups, Fraport depends on highly skilled staff at its airports around the globe for maintaining high operating standards, delivering top customer-focused services and to address the rapid changes that characterise today’s aviation industry. Thomas Uihlein, Aerodrom Ljubljana’s Chief Administrative Officer and Head of the Fraport Aviation Academy, explained the strategic importance of this training initiative: "The creation of the Fraport Aviation Academy as a new 'centre of excellence and learning' underscores Fraport’s commitment to enhancing Ljubljana as a sustainable location. Diversifying non-aeronautical businesses is a key element of Fraport’s strategy for its airport portfolio. We wish to harness the inherent synergies available at Ljubljana Airport, which has developed its own significant know-how, as a full-service airport company, in operations, handling and emergency services. Furthermore,

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the Ljubljana region is the perfect location where we can develop innovative world-class solutions in aviation training." Initially, the Fraport Aviation Academy will offer training in airport management, ramp handling, passenger handling, dealing with dangerous goods, occupational safety and fire services – training areas where Aerodrom Ljubljana has already been active for some years. The Fraport Aviation Academy will also get a brand new training centre, costing about EUR 3.9m, to be built on a site near Ljubljana’s General Aviation Terminal. Construction is scheduled to start in early 2017 and the inauguration is expected in early 2018. The new centre will make it possible to expand the number and range of training services offered in future years.

Diversifying non-aeronautical businesses is a key element of Fraport’s strategy for its airport portfolio.

Training will be done by experts from Aerodrom Ljubliana as well as staff from the broader Fraport Group. Later, the Fraport Aviation Academy could collaborate with chosen partners to deliver training modules in specialised areas. "A long-term objective of the Fraport Aviation Academy is to not only to pass on knowledge, but also to link the different areas of aviation into an integrated learning concept," added Uihlein. The Fraport Aviation Academy will serve as a training centre for the entire group and will complement the existing training facilities at Frankfurt Airport.  PHOTOS of Ljubljana Airport 01 Nebojša Tejić/STA 02 Tinkara Zupan/STA 03 Anže Malovrh/STA 02

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Slovenia has become more efficient in drawing EU funds Prepared by Nina Geč

In mid-2014, Slovenia was19th in drawing EU funds but, by the end of 2015, had significantly improved its efficiency to rank eighth. In February, Alenka Smerkolj, the Minister responsible for European Cohesion, referred to the successful absorption rate for the period 2007-2013 in an interview for Delo, "Slovenia has defied predictions that it would be unable to absorb its full EUR 4.1bn allocation from the European Union to boost its economy and is on course to spend the full amount. Slovenia has spent around 95 percent of the funds, a large part of which it received after the near-collapse of its banking sector in 2013."

According to Kristina Kočet Hudrap from Tiko pro, a consultancy firm which helps companies source refundable and non-refundable finance from EU funds, the biggest issues to deal with are non-familiarity with changes in the new period and the focus on a company’s own research and development department. "Many Slovenian companies don’t have such departments, which can often be a reason why their applications for funding are not successful," said Kočet Hudrap. On 1 September, the Government Office for Development and European Cohesion Policy publicly introduced the intermediate results for EU fund absorption for investment for growth and jobs. As at 30 June 2016, 19 percent of the available funds had been allocated, 12 percent of the contracts signed and 0.7 percent of the available funds had been paid from the national budget. There had not been any reimbursement of funds from the EU budget to the national budget. As both, Jakubowicz and Kočet Hudrap agree, Slovenia has done a great job allocating and using EU funds, so far. The reasons for the success are available information (FINA EU point) and good administrative capacity. One of the biggest projects, the construction of the A4 motorway, is currently underway and so the first signs for the start of the new programming period seem to be positive and fruitful.  PHOTOS 01 Regional Waste Management Centre of Ljubljana; Photo: STA 02 Jakub Adamowicz, spokesperson for the European Commission for Regional Policy; © European Union, 2014 / Source: EC - Audiovisual Service / Photo: Georges Boulougouris 03 Photo: Peter Černuta/STA 02

For the same period, the European Commission commented about the positive outcome of the one of the biggest and most successful projects, the Regional Waste Management Centre of Ljubljana, one of the most modern waste treatment facilities in Europe and the biggest environmental project in Slovenia in terms of budget. The project cost EUR 144m, with EUR 77m from the European Structural and Investment Fund (ESIF). "The waste centre services 37 municipalities in the broader Ljubljana area and in central Slovenia and reduces groundwater contamination and greenhouse gas emissions," according to Jakub Adamowicz, spokesperson for the European Commission for Regional Policy. On 30 October 2014, the European Commission approved the Partnership Agreement for 2014-2020. Slovenia prepared three operational programs for the implementation of the EU Cohesion Policy and has been eligible, from the beginning of 2015, to EUR 3.875bn from ESIF, an average of EUR 1,880 per person. "The

emphasis in this financing period is on the knowledge-based economy. We invest into research and development. We also encourage firms to specialise and to systematically involve the private-sector banks for funding options." Adamowicz indicated, stating that these are the new priorities. The Europe 2020 strategy includes two less developed Slovenian regions – eastern and western Slovenia – and targets development needs, existing disparities, growth potential and the promotion of smart, sustainable and inclusive growth. The program encompasses 11 thematic objectives and corresponding investment priorities, with a focus on promoting investment in research and development, boosting the innovation potential of small and medium sized enterprises (SMEs) to enhance competitiveness, encouraging the transition to a low-carbon economy and sustainable mobility, reducing social exclusion, poverty, improving employment rates and the effectiveness of public administration/services.

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Economy In less than one year after the establishment of the system, we have approved 111 projects and programs worth more than EUR 700m, which is more than 23 percent of all the resources available to Slovenia until 2023.

Alenka Smerkolj, Minister of Development, Strategic Projects and Cohesion

Interview: Alenka Smerkolj, Minister of Development, Strategic Projects and Cohesion

EU funds are, in the majority of cases, practically the only development funds in Slovenia Prepared by Tina Drolc

EU Cohesion Policy is the main EU investment policy and represents over 32 percent of the total EU budget or a little less than EUR 352bn, of which Slovenia is eligible to EUR 3.2bn or EUR 4.1bn if the funds available under the agricultural and fisheries policy are added. Alenka Smerkolj, Minister for Development, Strategic Projects and Cohesion, explains that Slovenia has already absorbed 95 percent of the EU funds available, which is in accordance with EU rules.

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Q What have we done so far with the funds received for the 2014-2020 period? A Despite the fact that the 2014-2020 period is carried out by the same team of people as the conclusion of the 2007-2013 period, the entire regulatory framework was accepted in a reasonable time. In less than one year after the establishment of the system, we have approved 111 projects and programs worth more than EUR 700m, which is more than 23 percent of all the resources available to Slovenia until 2023. Amongst other things, the project of building the motorway section, GruĹĄkovjeDraĹženci, amounts to EUR 63.5m, there are nine environmental projects in the area of waste water and drinking water, several programs connected to working with the unemployed, trainees and young people and several public tenders in the fields of entrepreneurship, including social, research, development or innovation. Currently, our focus is accreditation of the implementation system which is quite a complicated administrative procedure between the Member State and the European Commission, and which must be carried out so that we can start transferring funds from Brussels in to the Slovenian budget for co-financed projects. Currently we are managing this from the prepayment from the European Commission that Slovenia received after the approval of the operational program - it is a little more than EUR 90m, however we plan to finalise the accreditation by the end of the year. Q Has Slovenia absorbed all of the money currently available from EU funds? A If you are asking for the 2007-2013 programming period, you will probably remember that the implementation was not optimal and that since we have taken over the management of the government, the water flooded our throats in the area of EU funds. Furthermore, it was extremely likely that at the end of 2015, when the eligibility period ended, that Slovenia would not be successful meaning that more than EUR 4bn of available EU funds would not be used but, for me, that was not an option. Many people did not believe that we would suc-


Economy ceed, but we proved the opposite. Together with the ministries involved in the implementation, we have worked really hard to bring Slovenia 95 percent of the funds in accordance with EU rules. So, there remains five percent which will not spontaneously come to Slovenia, it requires a certain effort and completing the period of operational programs, projects, advantages axis. Since our team has already achieved a lot by running the Slovenian development cart in to positive numbers, I am confident that we will successfully fulfil the other tasks that still lie ahead in a timely manner.

The water flooded our throats in the area of EU funds.

Q Among the funding priorities in Slovenia of the Operational Program for the Implementation of the EU Cohesion Policy in the period 2014 – 2020 is the upgrade of the railway infrastructure. How much money is intended for railway infrastructure and what is the current level of realisation? A This is also one of our priorities. In the operational program there is EUR 153m allocated for infrastructure from the Cohesion Fund. Based on the results of the transport model, two projects are expected to be implemented the upgrading of the railway line from Maribor to Šentilj and the modernisation of the railway hub at Pragersko. Both projects are currently in the preparation phase of the project including the investment documentation where we cooperate with the JASPERS initiative. If all goes according to plan, both projects will start in the second half of 2017.

Q What is the cost of Brexit for Slovenia from the EU Cohesion Policy perspective? A Since there is still a lot of unknowns I cannot, unfortunately, give a realistic estimate. This is mainly because, at the moment, it is not clear when the United Kingdom will, in accordance with Article 50 of the EU Treaty, notify the Commission about its intention to withdraw. Also, we do not know how long the negotiations will last or what the future relations between Great Britain and the EU will be. Because of this, it is difficult to predict the destiny of the multiannual financial framework however, I have to say, that I do not have the best feeling. The first task will certainly be to restore the undermined trust among the Member States and to enhance people’s confidence in EU institutions, and to show (in practice) that with cooperation and networking we are serious. I think that our cultural, economic, social and political diversity is an advantage that needs to be identified. I think that more, and not less, Europe means more ideas and common sustainable solutions and for this, we must certainly endeavor.

Q How do you control the risk of fraud in the absorption and implementation of EU funds? A The search for new solutions for the prevention and control of the risk of corruption and fraud is one of our key priorities and responsibilities. Since the European funds in the majority of cases in Slovenia are practically the only development funds, it is necessary to ensure that they are allocated in an adequate manner and to the greatest possible effect. Extremely important is that our national surveillance is strengthened so that there is a more rapid identification of errors, irregularities or fraud, which was clearly written in the Partnership Agreement. In this context, it is very important to have close cooperation among the involved institutions and the efficient flow of information at all levels of the implementation of the Cohesion Policy and which pursue the common goal: the greatest number of successfully completed projects with a minimum return of

funds or financial correction. In order to have a more efficient implementation of the European Cohesion Policy and greater protection of the state budget, in case of any legal proceedings for the recovery of unduly paid funds, we prepared a draft agreement on co-financing that follows the basic objective of protecting the financial and the public interest.

Q In terms of fund absorption, Slovenia accessed a big part of the envelope dedicated to research and innovation, especially within the Smart Specialisation Strategy. What are the main outcomes we can already see? A In the context of the implementation of the Smart Specialisation Strategy, where in the current programming period EUR 461m of the European funds are available, we continue to support research, development and innovation. The focus is on areas with the greatest effects on the economy, and this year we have done a lot of work on establishing strategic partnerships. With investments in both the private and public sectors as well as with strategic alliances, Slovenia can provide quality jobs

and significant benefits in the long term. Our main drawback is our poor ability to integrate researchers with those who use the research. The state has therefore the role of coordinator and facilitator for networking, joint actions and investments and in addition, needs to support the priority areas in terms of human resource development, the educational system, economic diplomacy, promoting international networking, etc. Some important steps in this area have already been taken. At the beginning of the year, the Ministry of Economic Development and Technology (MEDT) and the Ministry of Education, Science and Sport, opened a public tender for promoting the implementation of R&D programs and projects valued at almost EUR 71m. Two public tenders were also announced to support strategic development innovation partnerships and for the establishment and operation of competence centres for the development of human resources. For these two areas we have allocated over EUR 14m.

Our main drawback is our poor ability to integrate researchers with those who use the research. Q Have any actions been taken recently to facilitate direct or indirect EU funding to Slovenian SMEs? A In Slovenia, we undertook that the resources available from the European Cohesion Policy 2014-2020 will be directed toward four key areas for economic growth and job creation - research and innovation, information and communication technologies, enhancing the competitiveness of SMEs and supporting the transition to a low carbon economy. Currently, from a financial perspective, the MEDT has EUR 885m of European funds available and from a planned 30 tenders, if I’m not mistaken, they have already opened 12, specifically in the areas of ​​promoting startup companies, the wood industry, products of the tourism sector and the construction of economic infrastructure. In the context of upgrading the support environment, we have set up the so-called Single business point for interested companies. For the purposes of financing the companies, there will also be financial instruments available, with the first measures expected in 2017. 

Slovenia 95 percent of the funds in accordance with EU rules. So, there remains five percent which will not spontaneously come to Slovenia. Autumn Edition 2016 | The Slovenian Times

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Economy

Faculty of Economics, University of Ljubljana:

The first and only "Triple Crown" international school in Slovenia and the region The AMBA accreditation is the third international award of excellence that has been bestowed on the Faculty of Economics, University of Ljubljana (FELU). The faculty is the only school in the region to have been awarded the EQUIS, AACSB and AMBA international accreditations, joining the elite group of Triple Crown schools. This achievement ranks it among the top one percent of business and economics schools in the world. For the faculty, which is celebrating its 70th jubilee this year, the triple recognition of excellence entails a responsibility to the students, employers and all the stakeholders who are writing and co-creating its story. Triple Crown accreditation is a synonym for a commitment to quality in business education, research, international integration and cooperation with the business sector. 18

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Economy The study of practical examples, acquisition of useful knowledge, international study experience, an innovative approach to study and contact with employers, all reinforce the quality of FELU graduates in both the domestic and international labour market. FELU provides employers with the best business and economics graduates. "FELU’s success is the reward and encouragement at the same time. It is a reward for past work and guarantee to all generations of students to gain invaluable foundation for personal and career development. Quality of the study and obtaining high-quality skills and competences is an excellent reference for all employers. Congratulations to all the students, professors and staff at the faculty!" Toni Balažič, President of the Management Board, Mercator Group FELU provides its students with the most relevant education, global networking and career development. For example, the FELU MBA program has become the first choice of current and future managers and leaders. "I come from the engineering sector and the FELU MBA program was an amazing experience since it really opened my mind in some areas. It truly helped me improve my knowledge on managerial skills, finance and leadership. I liked how the modules were connected with each other. The course you complete is then useful and beneficial for the following ones. I would recommend the program to people looking for a breakthrough point because it will really help them enhance their career."

a wide range of double-degree programs or undergo practical training abroad. More than 240 FELU students take part in an exchange program each academic year. The FELU’s quality is also recognised around the world. Every year, over 350 foreign students study at FELU as part of an exchange program. There are also more than 550 foreign students enrolled who take the full course, and 600 Slovenian and international students who participate in the summer school organised at the FELU and which is one of the biggest and most popular summer schools in the area of economic and business sciences in Europe. "Study at the FELU certainly had a major impact on my decision to seek employment and enforcement abroad. Lectures on current topics and issues of the economy, and the subsequent detailed discussion and analysis in the company of exceptional assistants, ensured the topic was approachable to the individual and encouraged mutual cooperation. The approach, nature of the study and availability of lecturers, tutors and teaching assistants increased my interest in events outside Slovenia and the desire for enforcement abroad. My decision also contributed to my experiences gained in the global section of the supply chain in Danfoss Trata and my thesis on the topic of safety stock. FELU has enabled me to acquire knowledge, develop skills, learn about current global issues / economic models through discussions and research tasks, which was

This achievement ranks it among the top 1% of business and economics schools in the world.

then reinforced in the international environment. It is necessary to believe in our own knowledge, explore areas of interest and build on experience. Such an approach quickly develops opportunities offered by the individual’s desire for reinforcement abroad.” Boštjan Zimšek, Demand Planner, PVH Corp. FELU is also home to many renowned Slovenian and international professors and researchers. Our visiting professors come from reputable foreign universities and scientific institutions, such as: Harvard Business School (USA), Rotterdam School of Management, Erasmus University (Netherlands), Leeds University Business School (United Kingdom), University of Leuven (Belgium) etc. The triple recognition of excellence enables FELU researchers to build an international network and collaborate in the research field with their peers from other elite world schools. Their research is applied in practice. "I have been collaborating with the FELU for several years in several areas. The most frequent and fruitful is the cooperation in the field of tourism, recently through research work, which brings remarkable discoveries. Not only they reveal that the vision of a sustainable relationship works locally, but through objective analysis and FELU research suggests that would have the same attitude in the wider tourism sector extremely positive global impact." Anže Čokl, Executive Director, Bohinj ECO Hotel

Marilyne Trendel, Independent consultant, France The international accreditations enable students and researchers to study in an international environment. The FELU has established a broad network of international partnerships with many top, Triple Crown business and economics schools, i.e. Monash University (Australia), HEC Montreal (Canada), BI Norwegian Business School (Norway), Aarhus School of Business (Denmark), Vienna University of Economics and Business (Austria), IESEG School of Management (France), University of Stellenbosch Business School (South Africa); Aston Business School (United Kingdom) and many more. Students can participate in exchange programs at one of the 190 partner schools in 44 countries all over the world; choose from Autumn Edition 2016 | The Slovenian Times

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Economy The business thinks that developing a brochure, perhaps telling a customer story instead of describing the product features, is content marketing. It’s not.

Robert Rose, Chief Strategist, Content Marketing Institute, USA

Interview: Robert Rose, Chief Strategist, Content Marketing Institute, USA

Breaking point for content marketing is now Rober Rose is Chief Strategist at Pulizzi’s Content Marketing Institute in the US where he develops content marketing and user experience strategies. He has worked with Oracle, the Bill & Melinda Gates Foundation, Microsoft, AT&T and many others. He looks at the developments in the content marketing field, attitude of brands towards content marketing and shares his views on it’s future. Q How has content marketing changed/evolved since you first started working in this field? A It has matured quite a bit. In the early days, the idea of content was to get as much as you could out so that you could rank higher in search engines and so that you could feed the new and developing social channels. But, as we’ve seen, more is definitely not better. Social media channels have evolved to become much more effective as paid media avenues than in trying to develop a community. The evolution

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has really focused efforts for those that are successful to developing high quality owned media properties.

Q What was, in your opinion, the breaking point for content marketing? A I think we’re going through it right now. With ad-blocking becoming much more prevalent and the social channels becoming truly impossible for brands to master without paying for access, and the increasing focus on data and privacy (especially in Europe with the GDPR), I think the need for brands to produce truly meaningful and valuable content across all channels is becoming an imperative.

Q What would you say are the mistakes content marketers make that keep them from achieving the desired results? A There are two that are most common. The first is mistaking content marketing for a different kind of advertising. The business thinks that developing a brochure, perhaps telling a customer story instead of describing the product features, is content marketing. It’s not. We have to create a consistency, an ongoing property that develops an engaged audience. The second is not committing to the longer term investment. Because many businesses still think of content marketing as a campaign, they run a program for two or three months –when it doesn’t drive the intended results they think it’s a failure. Q In your experience, do brands believe that content strategy will bring results or do they tend to be sceptical about it? Why? A There is a good and healthy dose of scepticism. The truth is that most brands haven’t really given themselves permission to be true content marketers and so, without that permission, the brand operates in a "safe" marketing and advertising way and creates bad content. We absolutely SHOULD ask ourselves the hard questions before we go forward with a plan. Q What are the biggest challenges content marketing is now facing? A Measurement. This is a challenge for marketing more broadly but truly, we have to get better at applying good measurement practices to content marketing. Q In what way do you see content marketing evolving in the next couple of years and what is standing in the way of marketers reaching that point? A I think the evolution of digital advertising, native advertising and social will really help drive the business case for a strong, differentiated owned media strategy for brands. I am very bullish about the future of content marketing as a strategic approach. I think the biggest thing standing in the way of marketers reaching that point is truly evolving the practice of content marketing into an owned media strategy, rather than just an alternative form of sales and marketing collateral material. We, as marketers, have to get out of our own way and start thinking like storytellers, rather than just acting like them. 


Economy Interview: Tanja Piškur, Head of Product range management, NLB

Banking will never again be what we once knew Prepared by Jenny Tumas

Bank branches are closing across Europe and banking is increasingly moving online (digital banking, mobile cashiers). Tanja Piškur, Head of Product range management at NLB, explains how the major Slovenian bank is dealing with digital transformation which is crucial and the biggest challenge for the bank, regardless of its future ownership. Tanja Piškur, Head of Product range management, NLB

Q How is NLB adapting to customer desire to bank online in terms of product development and staff support? A NLB follows the trend while also putting a lot of attention on the simplification and convergence of banking services. In the last three years, we have developed the Klikin mobile application for individuals, followed by the Klikpro mobile application this year, for which we have had a really great response, especially from smaller companies. In addition, we have redesigned and slightly upgraded our online banking, Klik, which enables comprehensive banking. Today, for example, you can an order of a loan is just a few klicks away. In September, we completed the introduction of e-pen - signature tablets which in the bank and the office replaces paper. Among other things, we have launched contactless cards, prepaid cards with a NFC (near field communication) sticker that can be pasted on the phone, and we can help customers with a mobile ATM which can be found at many events throughout Slovenia. Q What are your thoughts on how NLB and the banking industry can become more customercentric? A NLB’s strategy, at its core, is to focus on the customer. We want to offer customers simple and good solutions, while providing an excellent level of service. Therefore, we are introducing a number of innovations whilst also simplifying our offer to make it even more interesting. It is particularly important that we know our customers and understand their needs and problems. We invest a lot in to this since it is only through this that we can provide solutions and not just offer them more banking product. And this is our final goal.

Q Real-time payment platforms – systems offering 24/7 interbank fund transfers – are on the rise and preparing to upset the existing payment ecosystem. Is there any push in Slovenia to move to real-time payment systems? Where do you see the risks? A We already enable our customers to transfer their money amongst them within a second, 24/7, free of charge. Users of the Klikin app can remit money to a friend through the telephone directory. However, the fact is that competition in the banking sector in Slovenia has been strong, in part because of the relatively large number of banks. In addition, thereare new non-bank players stepping into the picture, who currently may have some digital skills which are simply better than ours. We watch them and from them we often learn something; and we also explore the possibility of cooperating with them. At the same time, we are aware of the importance of security. In the future, it will be crucial to find the right balance between a better user experience, security, and compliance with the law while providing holistic solutions to their problems. This triangle will not be easy to draw, but it will certainly be a very interesting journey. Q The NLB privatisation process has been a highprofile political story for many months. What are the bank’s priorities from a product management perspective as it undergoes this process? A Notwithstanding the bank’s ownership, we have set clear priorities for our future operations. One of these is the efficiency and simplification of business processes and services, the second is transition to innovative development of the bank where we will intensively deal with the solutions that can be offered to our cus-

tomers and thus improve their experience and satisfaction. At the same time and even more, we will remain a regional specialist in this area.

Q Where do you see the biggest challenges and opportunities for NLB in the next five years? How is the bank preparing to meet these challenges? A Development of digital technologies requires a transformation in thinking and changing of existing business models; business is faster and accessible from anywhere. The digital environment has significantly reduced costs through the introduction of a new transaction method and therefore the number of digitally-oriented companies will grow intensively in the future. It is no longer sufficient to just digitise individual departments or processes, it is necessary to digitally transform the company as a whole which is changing the way of management, jobs and individuals. Even more so, the banking industry is experiencing tectonic, disruptive movements and I dare to say it will never be as we once knew it. The competition is intensifying, we live in a period of negative interest rates which the world economy has never experienced before and the impact of digitisation very much reflects the expectations of our customers and ourselves. Therefore, the biggest challenge is the digitisation of operations. NLB’s strategy involves a focus on information technology which enables digitisation. Equally important is to change our mindset, the way we think and adapt to this new trend. On the other hand, NLB has a unique advantage as a large bank in the Slovenian market which is present throughout the country and offers services that other banks do not.  Autumn Edition 2016 | The Slovenian Times

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Economy

Ningbo forum

Chinese Ningbo city businesses and officials visit Slovenia

nian prime minister Miro Cerar at the meeting of China and Central and Eastern European Countries ('16+1 mechanism') in Suzhou.

Ningbo week in Slovenia was supported by H. E. Ye Hao, Ambassador of People’s Republic of China in Slovenia, Mitja Bervar, President of National council of Republic of Slovenia, and organized in cooperation with towns Koper, Maribor and Ajdovščina and Severna Primorska development agency. SPIRIT agency’s representative Tanja Drobnič stressed the favorable regional position of Slovenia and its business environment. Almost fifty enterprises from Ningbo and Xiangshan attended and expressed their interest in exploring common projects. Their stated objectives were to set up local sales network or sales departments, investigate the local companies, get to understand the local investment environment, advance equipment purchase intentions, advance cooperation and to enter or open the Slovenian market.

At the forum in Ljubljana Andrej Miklavc, Olympian and founder of Winter Sport Expert Group further stressed that 2022 Olympics are a big opportunity to build and strengthen relationships with Chinese partners on many levels. This is why intense communication through the Chinese embassy, the 16+1 mechanism and events like Ningbo week are needed. Slovenian experts can provide knowledge and development of specific winter sport infrastructure like ski jump hills, organizing and setting up events, winter sport schools and clubs. On the other hand, if Chinese winter

To bring as many mutual benefits as possible into reality, Pan Yingming, representative of Overseas investment promotion division of Ningbo Ministry of Commerce, suggested to establish regular linking mechanisms for the convenience of trade contacts promotions and investment cooperation. Further organization of local enterprises to attend various exhibitions should be supported, as well as deepening of education and tourism cooperation and other activities that will help enterprises to have a comprehensive understanding about all sides of potential partnerships. 

Prepared by Silvija Fister

More than 50 representatives of business and local government from Ningbo city visited Slovenia to discuss possible common investment and development opportunities with Slovenian companies from September 20 through 25. As part of 'Ningbo week in Slovenia' business and investment forum was held at Hotel Union in Ljubljana on September 22. The visit is part of ongoing activities of Public agency for entrepreneurship, internationalization, foreign investments and technology (SPIRIT Slovenia) in the Chinese market which, together with business partners, represented Slovenia at the 2nd CEEC Investment and Trade Expo in Ningbo city earlier this year. National pavilion hosted Slovenian innovative and high tech companies like Smart Solutions Consortium and aviation innovator Pipistrel and invited cooperation with interested companies from China. Possible common projects like building sport infrastructure for the 2022 winter Olympics in Beijing were discussed. The notion of Slovenia as highly competitive in the field of sports infrastructure building was already suggested at last year’s visit of Slove-

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The Slovenian Times | Autumn Edition 2016

sportsmen want to excel, they will have to come to Europe, home of many winter sports. Building a logistic, training and preparation base for Chinese sportsmen in Slovenia was proposed, which would include mutual benefits of access to Slovenian expert knowledge, experience and technology and overall popularization of winter sports.


Investment Opportunities

More information about investment opportunities is available at www.nepremicnine-har.si

HETA Asset Resolution d.o.o. in Slovenia is part of the HETA Group, a wind-down corporation owned by the Republic of Austria. Its statutory task is to dispose of the non-performing and non-strategic portion of Hypo Alpe Adria, nationalised in 2009, as effectively as possible whilst preserving value. As part of the asset disposal process, we present an attractive opportunity to invest in Slovenia. We offer a portfolio of over one billion financial claims as well as over 350 residential and commercial properties. HETA’s real estate assets are well diversified across Slovenia, in type and industry. Equally attractive is the diversity of the claims portfolio in terms of issuers, exposure and maturity.

Price: 4,500,000 EUR

Price: 2,074,000 EUR

Hotel Celovški dvori **** – development plot

Qlandia III – commercial development project

Construction site with valid building permit for a 10-stories hotel on a prime location in the north part of Ljubljana, at main access road to the city. Current Municipal Spatial plan also allows residential development of 21 stories high freestanding building. The development land plot has valid construction permit and already excavated construction pit prepared for foundation building

Properties’ attractive location right next to regional shopping centre and important international traffic route Ljubljana - Zagreb provides numerous development opportunities on a local, regional and international level. Its overall market-gravitational area covers over 50,000 households with above-average purchasing power.

KEY FIGURES

Location: Otoška cesta, Novo mesto  Land: 24,230 m2  Development: greenfield  Type of Use: commercial  Foot print ratio: 50%  Development intensity: 2  Max. height: 12 m

Location: Celovška cesta, Ljubljana  Land size: 8,139 m2  Development: brownfield  Type of Use: hospitality  Foot print ratio: 95%  Floors: -4, GF, 10 upper floors

KEY FIGURES

Price: 1,800,000 EUR

Price: 2,875,000 EUR

Hotel DIANA *** – charming city hotel

Tehnopolis II – office building

Hotel is located in the centre of Murska Sobota. City’s largest hotel is a meeting point for pastry lovers, business events, large social gatherings and trips to endless plains, winding Mura river, ponds and thermal springs. The building was built in 1967 in 2009 the hotel has completely changed its internal and external image.

Cutting-edge 8 stories high office building with smart installations and underground garage is located in Technology Park Celje at the main regional road leading to city centre. One third of the property is long-term leased and the rest is available to move in. The frame structure allows low cost layout customization according to investor’s needs.

KEY FIGURES

Net Useable Area: 8,280 m2  Floors: -1, GF, 6 upper floors  Year of construction: 1967, renovated 2009  Hotel capacity: 97 rooms, restaurant with 200 seats, event venue with 500 seats, pastry shop & coffee-house, bath, saunas, whirlpool, fitness and 5 treatment rooms  Parking places: 50 and free public parking nearby

KEY FIGURES

Floors: -1, GF, 8 upper floors  Net Useable Area: 3,314 m2 (office area 2,649 m2 + garage 664 m2)  Land: 1,608 m2  Year of construction: 2008  Parking places: 20  Type of Use: office  Occupancy: 30%


Slovenia Investment Insight

FDI Spillover – learning from the best Prepared by Polona Domadenik, Ph.D.

In academic literature, Foreign Direct Investment (FDI) is usually perceived as a development tool that helps less developed countries to catch up with the most developed group of countries. Attracting multinational firms is an important mean of distributing the best production technology, managerial knowledge and working practices that differentiates the most efficient firms from the others. In economic models, these factors usually represent the famous Abramovitz’s "measure of our ignorance", the difference between more and less productive firms. For firms, cutting edge technology and viable business models are prerequisites to play in the "Champions League". A deeper understanding of FDI transmission mechanisms helps create an adequate institutional setting in particular countries. Multinational firms don’t come to Slovenia because they like the country, nature and landscape; they, of course, come for profit However, the spillover effects are substantial and for the recipient country, its firms and inhabitants also benefit. Several econometric analyses have confirmed the direct and indirect spillover effect from FDI as an increase in the productivity of local firms because of technology transfer from foreign to domestic branches. However, the effects are also identified along the value

country and characteristics related to foreign investors.) At this point, it is worth highlighting the most important factor for foreign investors when they make their decision on where to invest - institutional characteristics. Institutions, in general, play a very important role in attracting foreign investors and determine the magnitude of the spillover effects. The rule of law, transparency of the tax system and a lean bureaucracy are only a few of the things that are important. Existing research suggests that foreign capital flows into those countries with good institutional infrastructure. One of the most

Existing research suggests that foreign capital flows into those countries with good institutional infrastructure. One of the most important dimensions in this context is the level of corruption. chain, from foreign firms to domestic suppliers or foreign suppliers to domestic firms. Although it is difficult to find support about the horizontal spillovers, it could be speculated that competitors from the same industry benefit due to improved capabilities of suppliers or customers. More recent studies have, however, shown that significant positive spillovers exist, but are conditional on a number of intervening factors including firm/sector characteristics (such as firm size, absorption capacity and technological distance, sector and geographical location, institutional characteristics of the recipient

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The Slovenian Times | Autumn Edition 2016

important dimensions in this context is the level of corruption which is usually considered a deterrent to FDI While some authors have found that high levels of corruption have a detrimental effect on FDI (Cuervo-Cazurra, 2006; Voyer & Beamish, 2004; Woo & Heo, 2009), others have not found a relationship between these variables (Henisz, 2000). Furthermore, other studies have actually found that corruption can be positive as it facilitates transactions in countries with too many regulations (Egger & Winner, 2005). The possible explanation is simple and straightforward, by observing the patterns we can figure out that

Polona Domadenik, Ph.D., is Deputy Dean, Full Professor in Economics and a member of the Academic Unit of Economics at the Faculty of Economics of Ljubljana University. Her list of publications includes several articles on issues related to the post-privatisation restructuring of firms in transition economies (Slovenia, Croatia and Macedonia), and various topics from labour economics.

corrupt countries attract FDI from similarly corrupt countries. On the other hand, firms from a home country with relatively low levels of corruption are unfamiliar with the formal and informal institutions associated with corruption and choose similar countries to invest. Without doubt, the spillover effects are greater in the latter case. Therefore, Slovenia needs to reconsider whether the institutional system will attract FDI from less corrupt countries. If not, there is a clear agenda for the future. 


Slovenia Investment Insight

Hotel Kempinski Palace PortoroĹž

Setting the stage for FDI Summit Prepared by Valerio Fabbri

Foreign direct investment (FDI) has gained significant importance over the past decade as a tool for accelerating the growth and development of transition economies. It is widely believed that the advantages that FDI brings to the standard of living and prospects for economic growth of the host nation largely outweigh its disadvantages. International trade and FDI can be very effective ways of stimulating technological progress for a lessdeveloped country. There are many factors affecting FDI such as intellectual property rights, economic stability, political climate, the labour market, relative wages, financial and tax policies, host country gross domestic product (GDP), corruption and so on.

Many factors contribute to the creation of the investment climate, a set of location-specific factors shaping the opportunities and incentives for firms to invest productively, create jobs and expand. Government policies and behavior exert a strong influence on the investment climate through their impact on cost, risk and barriers to competition. A good investment climate is about improving outcomes for society as a whole. Wages, raw materials and the like are the normal costs associated with any investment activity, but many costs flow more directly from government policies and behaviors such as taxes. Governments also have an important role in addressing market failure and supporting the provision of infrastructure. Weaknesses in government performance in these areas can greatly increase the costs for firms and make many investment opportunities unprofitable. FDI flows stem from different sources. While FDI flows emanating from mergers and acquisitions (M&A) can provide a valuable source of foreign exchange and long-term capital to finance the balance of payments, the economic impact of M & As on the host economy is generally regarded as neutral in terms Autumn Edition 2016 | The Slovenian Times

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Slovenia Investment Insight of job creation and capital investment. The impact is very much deal specific and depends on the plans of the foreign investor for the acquired company – to re-invest and expand, rationalise or shut down – and if the M&A deal is a successful organisational merger. A more prominent FDI source comes from greenfield investments where the parent company builds its operations in a foreign country from the ground up. The economic impact of greenfield FDI is generally regarded as positive – it is new net capital investment and job creation for the host economy. Increased domestic capital investment and job creation through the supply chain and the wealth effect further increase the direct and indirect impact of greenfield FDI. Greenfield investment is less volatile than M & A and other types of foreign investment.

FDI in Europe In 2015, Europe built on the momentum established in 2014 and achieved a record level of 5,083 projects (up 14%) and 217,666 jobs (up 17%) created from FDI, according to Ernst Young’s European Attractiveness survey. This was at a time when Europe was facing multiple headwinds, such as the migration crisis, sluggish growth and terrorist attacks in France and Belgium. In part, the numbers reflect an overall capital preference for developed markets over emerging markets during times of uncertainty, although they also reflect an increased focus by national policymakers on FDI as a route to economic growth. Favorable exchange rates and cheaper oil added to Europe’s industrial competitiveness. The top three countries in terms of FDI are the United Kingdom, Germany and France, which together account for 51 percent of all FDI projects and a third of all jobs created. However, Germany, the UK and France saw little change in industrial activity, while the automotive sector drove manufacturing growth in Hungary and Poland, and machinery and equipment dominated in Turkey, Serbia and Romania. Although Western Europe continues to lead FDI projects, inward investment into Russia, the Commonwealth of Independent States and Central, Eastern and South-Eastern Europe witnessed an increase in FDI in terms of project numbers (6%), capital investment (12%) and job creation (13%), according to fDi Markets, the online database of cross-border investments from the Financial Times Group. In other words, the region grew almost four times as fast as its counterparts in Western Europe. As far as jobs are concerned, the region saw the creation of 50 percent of all FDI jobs, mostly in Poland, Russia and Romania, due to the strength in manufacturing which accounted for 69 percent of FDI projects.

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The Slovenian Times | Autumn Edition 2016

The Visegrad countries have had a reasonable record in attracting FDI since 1990, having been the recipients of some of the highest levels of inward FDI per unit of GDP in Europe, according to data from the Organization for Economic Cooperation and Development (OECD).

FDI in the Visegrad Countries Given the geographic proximity and a similarly recent path in terms of economic transition, a closer look at the Visegrad countries, i.e. the Czech Republic, Hungary, Poland and Slovakia, puts into perspective the FDI situation in Slovenia. The Visegrad countries have had a reasonable record in attracting FDI since 1990, having been the recipients of some of the highest levels of inward FDI per unit of GDP in Europe, according to data from the Organization for Economic Cooperation and Development (OECD). Behind the large cumulative inflows and favorable FDI to GDP ratios, there is a story of positive foreign investment policies, relatively stable business environments and an abundant supply of cheap, skilled labor. However, as real wages have risen in all of the Visegrad countries, the region has lost some of its attraction for investors sensitive to labour costs. Since the global economic and financial crises, FDI inflows have tailed-off for a variety of reasons, with services now being the dominant recipient for FDI, instead of manufacturing as was the case in the 1990s. In AT Kearney’s FDI Confidence Index 2015, based on a global investor survey of the Visegrad countries, only Poland makes it in to the top 25 preferred FDI destinations (23rd), and in the 2016 survey, Poland is not even included. This means that investor confidence is not rocksolid towards Poland, let alone towards the broader Central European region. As far as investment climate and confidence, Hungary is an interesting case. It has been led by populist Prime Minister, Viktor Orban, since 2010, whose government has implemented policies hostile to FDI, most notably in the banking sector. Yet FDI inflows to Hungary peaked in 2012, according to United Nations Conference on Trade and Development (UNCTAD) data. This suggests that negative changes

to FDI-related policies do not necessarily reduce FDI inflows if the general business environment remains broadly stable. Likewise, the Polish government, elected in October 2015, has declared that Poland will remain an FDIfriendly country, although some of its policies are hostile toward FDI, especially in banking and retail. However, as long as Poland offers a large domestic market and access to the European Union (EU) market, multinational companies seem eager to continue to invest there. The Czech Republic is the embodiment of stability in relation to FDI, as in other matters. Although it has recently become less stable politically, a change of government does not imply policy discontinuity. The main question mark over prospective FDI flows concerns the size of the domestic market and the capacity to absorb much more FDI. In Slovakia, despite uncertainties associated with the political situation, the FDI framework remains very favorable, with additional investor-friendly reforms recently implemented. Jaguar Land Rover, a subsidiary of India’s Tata Group, is investing to establish a manufacturing plant in Nitra, the fifth largest city in Slovakia with about 80,000 inhabitants. Production is scheduled to launch in late 2018 with an initial capacity of 150,000 vehicles. In line with a government decision in January this year, Jaguar Land Rover’s plant will enjoy the status of a significant investment. State assistance, worth a maximum of EUR 130m in the form of a subsidy for long-term tangible and intangible assets, was approved for the Jaguar investment in December 2015. The investment cost of the Strategic Park Nitra area will be around EUR1.406bn with 2,834 jobs directly created in line with the business plan, according to a report by the Ministry of Economy of Slovakia. Under these mutually convenient conditions, the UK’s decision to leave the EU has not altered the investment plans.

Since the global economic and financial crises, FDI inflows have tailed-off for a variety of reasons, with services now being the dominant recipient for FDI, instead of manufacturing as was the case in the 1990s.


Slovenia Investment Insight FDI in Slovenia

A View from the Field

Slovenia’s economy grew at 2.9 percent year-on-year in 2015, driven by net exports and private consumption. In 2016 and 2017, domestic demand will be the main driver of growth, mainly on the back of improved labour market conditions and a recovering housing market. The contribution of net exports to growth is also expected to decline significantly, as imports will rise on the back of rising domestic demand, albeit with still strong exports. Overall, the economy is expected to grow by 2.0 percent in 2016 and by 2.3 percent in 2017. Despite an encouraging economic outlook, FDI is still lagging. Slovenia is one of the EU countries with the lowest FDI to GDP ratio. This is fundamentally due to the inability to attract foreign capital and the strong presence of the public sector in several important companies. According to Bank of Slovenia data, from 1994 - 2014 FDI grew from EUR 1bn to EUR 10bn, with a yearon-year growth of about 11.9 percent. In 2015, there was FDI of EUR 12.6bn, a 24.6 percent improvement on the previous year. Slovenian companies with foreign capital account for almost 30 percent of trade and 27 percent of net profit, despite representing only 4.5 percent of all companies operating in the country. The qualified workforce in Slovenia is good but scarce, and that may be one of the reasons Slovenia has not attracted major investments in productive new sites because "we didn’t offer either a huge new site – an automotive plant needs 200 hectares with good infrastructure –or skilled and unskilled labour", Peter Kraljič, Director Emeritus of international management consultancy firm, McKinsey & Company, stated during the 2010 FDI summit. Immigration laws are also not very attractive for importing a foreign workforce, if it is true that even "many Slovenian companies have difficulties obtaining qualified, technical staff", Mr Kraljič continued. In summary, the low levels of FDI flows in the past indicate that Slovenia has not been widely recognised as an attractive location for investments for reasons that range from having a small domestic market to bordering an unstable region. The existence of some  competitive domestic enterprises,  with a firm foothold in the small domestic market, is also a clear signal that foreign companies have to make greater effort to win market share. Furthermore, the voucher-based, decentralised privatisation model  in the first half of the 1990s left less room for foreign investors than in other countries in the region.

According to data analysis prepared for The Slovenia Times by Bisnode d.o.o., FDI in Slovenian equity amounted to EUR 9.2bn at the end of September 2016, up EUR 1.1bn or 13.5 percent from 2014. FDI makes up about a fifth of total equity in Slovenian companies, with the majority (over 70%) from EU Member States, followed by ex-Yugoslavia countries and Switzerland. The biggest FDI investing country remains Austria with a 24 percent share, followed by Croatia (15%) and Switzerland (10.2%). The rest of the world contributes less than 4 percent. The sectors that attract the most FDI are financial services and insurance, distribution, commercial services and leasing, chemical products, tyres and plastic products, engineering, paper, telecommunications, transportation and the tourism industry. The most significant manufacturing sub-sectors for FDI are pharmaceutical preparations (28%), followed by motor vehicles and domestic appliances. Within the financial and insurance activities, the most crucial for FDI is banking (73%), followed by holding companies, life insurance, financial leasing and reinsurance. During the first summit of foreign-owned companies, organised by the Slovenian Foreign Investors Forum (SFIF) at the Chamber of Commerce of Industry in Slovenia (CCIS) last April, a FDI Declaration summed up the challenges faced by foreign investors that hinder their growth. They are: high labour, profit and personal taxes; poor payment discipline; and an inefficient judicial system. The declaration also stated, as its main goal, to increase FDI to EUR 15bn in five years from the current EUR 10.5bn. According to SPIRIT Slovenia, the Public Agency for Entrepreneurship, Internationalisation, Foreign Investments and Technology, "Slovenia offers a supportive environment for emerging businesses looking to thrive internationally through its technically-savvy workforce and pro-business infrastructure. Slovenia’s appeal is not low-cost manufacturing but the reputation of its technology- and innovation-driven industries", according to Matej Skočir, head of the sector for internationalisation and FDI at SPIRIT. "Slovenia’s business environment is conducive to

Slovenia is one of the EU countries with the lowest FDI to GDP ratio.

FDI in Equity of Slovenian Companies by Region

The most significant manufacturing sub-sectors for FDI are pharmaceutical preparations (28%), followed by motor vehicles and domestic appliances. entrepreneurial activity, but its potential as a gateway to a region of 45 million consumers and to the EU market with 500 million people is still waiting to be fully developed. Its supportive environment, with pro-business infrastructure and a technicallysavvy workforce should compensate for the fact that further fiscal stimulus is not likely given the current state of public finances and the need to decrease the deficit and reduce the items with the lowest multipliers on GDP", Mr Skočir added.

Gradual Transition: Miracle or Misfit? "Slovenia has always been small and open, something that has created an awareness that we always had to go abroad to look for internationalisation", claims Andreja Jaklič, a Professor of International Economics from the Center of International Relations at the Faculty of Social Sciences at the University of Ljubljana. "There are many small SMEs, which are very good, whereas large enterprises are weaker. Those enterprises are internationally-oriented, with a tradition for internationalisation, innovation and a good capacity to attract talented people". An important part of Slovenia’s concept of the gradualist transition to a market economy was a conservative attitude to foreign capital which gave Slovenia an image of a country unfavorable to foreign investment. In spite of that, some major acquisitions by foreign enterprises took place, however externally, they were not a part of a complete strategy or foreign investment stimulation in desired sectors. They were merely the realisation of current opportunities or bids by foreign enterprises or new owners wishing to make a transition profit. "However, I believe that we are paying the price for the gradualist approach, because timing is cru-

Foreign Equity EUR

Foreign Equity Share

EU 28 (without Croatia)

6.480.782.678

70,3%

Ex-Yugoslavia

1.498.969.739

16,3%

Switzerland

936.082.288

10,2%

Rest of the World

306.620.558

3,3%

9.222.455.263

100,0%

Total

Autumn Edition 2016 | The Slovenian Times

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Slovenia Investment Insight Regardless of the good initial conditions in the early stages of transition, by 2005 Slovenia still lagged behind in completing the transition and it was ranked the second worst country in the EU.

Andreja Jaklič, Professor of International Economics from the Center of International Relations at the Faculty of Social Sciences at the University of Ljubljana

cial for internationalisation, meaning that actions should be made at the right time. Speed and agility are the only features that help you to survive". As the economy moves toward digitalisation, "companies need diversification to grow, and only brave, fast and risk-prone companies are successful", Professor Jaklič added. It is a fact that enterprises are changing much faster than the economy and the institutions where there remains the legacy of the gradualist approach. Regardless of the good initial conditions in the early stages of transition, by 2005 Slovenia still lagged behind in completing the transition and it was ranked the second worst country in the EU in the World Bank "Ease of doing business" report. This year, Slovenia ranks only behind Poland of the Visegrad countries and sits 29th overall. "We need to be fast because Europe is changing very quickly and this means increased competition, but also better living standards and purchasing power capacity. Other countries in Central and Eastern Europe are growing fast and this is good for us because it means, not only that the region is in good shape, but also that the global value chain is changing. Slovenia could benefit from this and we need to be ready, otherwise capital goes where there are investments", Professor Jaklič concludes. Slovenia does have much lower labour costs than any of the major EU investing countries, but it is not up to date in terms of productivity. However, labour costs are not the main reasons

An important part of Slovenia’s concept of the gradualist transition to a market economy was a conservative attitude to foreign capital which gave Slovenia an image of a country unfavorable to foreign investment. 28

The Slovenian Times | Autumn Edition 2016

for an investment. According to SFIF, foreign investors generally list multiple objectives – growth, profitability, expansion of exports, recognised trademarks, quality of labor – in their ventures in Slovenia. Professor Jaklič, who cooperates on a research project in the area, seconds this view: "interviews with foreign investors indicate that most FDI in Slovenia is of the factor cost advantages-seeking type. As far as the role of labour is concerned, it is clear that it is not the low cost, but rather the quality of labor that motivates foreign investors." With a very demanding and sophisticated consumer base, Slovenia could be attractive to foreign investors not only for its quality of labour, but also as a laboratory and test market for price sensitive and innovative consumers.

With a very demanding and sophisticated consumer base, Slovenia could be attractive to foreign investors not only for its quality of labour, but also as a laboratory and test market for price sensitive and innovative consumers.

Highlights and Lowlights As a fully developed economy integrated into international markets, Slovenia is completely open to foreign investment, in accordance with the principles of the EU and the OECD, and does not discriminate between national and foreign investors. However Enrico Galassi, the Italian General Manager of Porting d.o.o., the company that operates the marina in Izola, holds a different view: "Slovenia is unfit to have foreign investors." This was stated by the U.S. Ambassador Mussomeli and reported at the end of the summer 2011 by The Slovenia Times with the title "Undiplomatic diplomacy". "I am facing again discriminations on the basis of being a foreigner”, continues Mr Galassi, who has been working in the country since the early stages of independence. "Taxation in Slovenia is stated to be 19% on profits. In my case it is a totally different story, as taxes on profits are equal to zero. As you can see", showing a document with fiscal information he has collected, "the numbers of total sales are taken away from the balance sheet. The evidence is that taxes are applied not on profits, but on the overall sales: in this way profit is impossible!". According to Mr Galassi, this "is aimed at the expropriation of the Italian investment, in a way similar to the expropriation of the Swedish investment in the Slovenian TV market", referring to the 2012 decision of Modern Times Group

Marina Izola - Enrico Galassi during the September 2016 Diplomatic Regata with Vasilij Žbogar, Silver Olympic medalist at Rio 2016. Photo by: Denis Markežič


Slovenia Investment Insight

Tomaž Lanišek, General Manager OEM Europe & CIS at Knauf Insulation

Knauf Insulation Plant

The numbers of total sales are taken away from the balance sheet. The evidence is that taxes are applied not on profits, but on the overall sales: in this way profit is impossible!

bought by the German company, claims that "transparency is crucial when it comes to taxation. It is better not to change taxation every year, but rather make it clear for the future and respect it". Administrative obstacles to investment and company operations are a relevant constraint to more active engagement by domestic and foreign investors, as barriers increase the costs of setting up and running a company. Despite recent efforts to reduce the number of hurdles, in some areas administrative procedures still remain too long and complicated. On this topic, Mr Lanišek said that at Knauf they waited for six years (!) for an authorization to renew a production line, which was completed last May. "Our objective is to invest 25 million euros in 2018 for the new production line (Line 1) on the company’s 70th anniversary". Needless to say, he hopes to avoid waiting as long for the permits. Because investment decisions are forward looking, firms’ judgments about the future are critical and uncertainty clouds all investment decisions. Many risks for firms are a normal part of investment, and firms should bear them. But governments have an important role to play in creating a stable and secure environment. Policy uncertainty, macroeconomic instability, and arbitrary regulation can also cloud opportunities. However, as professor Jaklič notes, "we have political stability and the economy is back in shape. But we don’t have political responsibility. I think that a masterplan will help make clear who does what, because it will be a crucial instrument to monitor and follow how value is created, so that policy-makers and institutions are aware and accountable, especially for its implementation. We need a tool like this because behind the vision there must be a clear plan accepted by the whole society and all political parties. And such

masterplan should be cross-industry, as in this globalization period we need not only to act fast, but also create synergies". In other words, it is good to go from fragmentation to coordination, entering intra-regional projects, thus boosting traditional and digital infrastructures also through EU funds. Boštjan Gorjup, CEO of BSH Hišni Aparati d.o.o., says that intraregional projects could as well be an inevitable opportunity in the near future: "given the latest globalization trends, whereby what is consumed in Asia is produced in Asia, i.e. production and consumption are regional, there is an opportunity for the Central and Eastern European region to become the continental hub for household appliances production." Some argue that state presence in the economy is holding back its smooth development, as the public presence is still too pervasive and oftentimes detrimental. However, the Silicon Valley inception and development, masterfully written in the book "The Entrepreneurial State. Boštjan Gorjup, CEO of BSH Hišni Aparati d.o.o.

BSH Hišni Aparati d.o.o. Plant

(MTG), a Swedish media company, to sell TV3 channel because of "market un-competitiveness and unresponsiveness of the national regulators", as stated by MTG upon withdrawing its investment from the country. If these two examples may be perceived as extreme, it is a matter of facts that tax administration is considered a most severe obstacle by several entrepreneurs, both Slovenian and international. Tomaž Lanišek, General Manager OEM Europe & CIS at Knauf Insulation in Škofja Loka, formerly Termo until in 2007 it was Autumn Edition 2016 | The Slovenian Times

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Thies Bruhn, General Manager at Kempinski Palace Portorož

Hotel Kempinski Palace Portorož

Debunking Public vs. Private Sector Myths", by University of Sussex economics professor Mariana Mazzucato, is a perfect example of the importance of the state, which could be extremely positive. In sum, it is not about public versus private ownership, but rather about behaving as a responsible owner, one that takes the risks and defines the direction and then ensures the continuity of leadership, without changing leaders every so often. For example, the Slovenian Sovereign Holding (SSH), whose most important activity since the end of 2012 "has been the active management of capital assets held in the ownership of SSH and the Republic of Slovenia, as well as running the privatisation process, settling of State’s liabilities, and denationalization", as stated on its website, has reshuffled its leadership three times in less than two years, the last time just a few months ago. It is safe to state that this high turnover at the helm of SSH is not a synonym of stability or continuity. Thies Bruhn, General Manager at Kempinski Palace Portorož, is among those who believe that the state presence is perhaps still too pervasive. "there is room for improvement, as the bureaucratic procedures are still quite lengthy and the rigid work legislations hinder the production flexibility required in the business environment. In recent years Slovenia has experienced quite a few privatizations; nevertheless, the most important companies remain in the public hands." Asked about Slovenia’s investment propositions, Mr Bruhn has a clear view: "while Slovenia has the potential to be a promising emerging market for investors, due to many geo-political reasons, it needs to focus its activities further into creating an investment-friendly environment. For example, Slovenia points out its advantageous strategic geo-

location, and yet it lacks modern infrastructure, which could enable it to become an international hub. Besides", Mr Bruhn continues, "the country is not providing strong market incentives, which would motivate foreign investors and is partly acting far too slow. Friendly foreign investment policies and encouragement are needed quickly, as we are facing a strong international competition. Other competing destinations are much faster at defining their strategy and adapting their bureaucratic procedures, enabling them to develop in an effective and efficient manner." Firms prefer to face less competition, not more. But barriers to competition that benefit some firms deny opportunities and raise costs for other firms. In this regard, there is a lack of clear policy steps, especially in supporting investments in private sector. So the confidence of firms in the future—including the credibility of government policies—determines whether and how they invest. Policies that lack credibility will fail to elicit the intended investment response. Another weakness identified by foreign entrepreneurs is the deteriorating quality of legal institutions. Investors pay attention to the rule of law, for example whether

The Slovenian Times | Autumn Edition 2016

It is not about public versus private ownership, but rather about behaving as a responsible owner, one that takes the risks and defines the direction and then ensures the continuity of leadership, without changing leaders every so often.

they can expect from court contract-execution. According to a paper by Aljaž Kunčič, a researcher at the Faculty of Social Sciences of the University of Ljubljana, the quality of the legal branch and its institutions is inadequate. In his research he analyzes Slovenian economic and legal institutions vis-à-vis the EU average, to conclude that the quality of Slovenian economic institutions is stagnating, although improving in relative terms. Whereas the worrying factor is that legal institutions are falling in relative and absolute terms.

Long-term Investments It is no surprise that the most successful investments are those present in Slovenia for the long term. Again Mr Lanišek: "although we are not at pre-2008 level, the crisis is behind us. We want to invest more on research and development (R&D) rather than on production only, but this depends also on the government. We should focus on the sectors that are good for Slovenia and that we are good at, because it is high time to make a decision: as a country, do we want to compete with small and medium companies or have the big investments? We are an export-oriented country, we have Lek Sandoz, just to mention one great, foreign-owned company, and we have a few success-stories, but this is not enough. We need to do more to attract FDI. For example, the first billion-euro Slovenian company, Outfit 7, is not headquartered here: we should not ask ourselves why, but also reply to that question". Tomislav Čeh, General Manager of Union Hoteli d.d., offers an interesting perspective from the hospitality industry vis-à-vis FDI: "even though Slovenia is an attractive location for investments, there are still a lot of challenges


Slovenia Investment Insight

Tomislav Čeh, General Manager of Union Hoteli d.d.

Grand Hotel Union

to potential investors that should be improved in order to boost investments, such as the extent of bureaucratic procedure, lack of transparency in economic and commercial decision making, inconsistent taxation. We are still a country of too much bureaucracy. Apart from these, when we promote ourselves we need a consistent strategy and a more credible presentation: the Slovenian tourism sector needs foreign investments as desert needs water, especially in the hotel sector. We need to know that so much needed broader variety of hospitality know-how is also correlated with foreign investments". The importance of international investment is crucial also when it comes to knowledge transfer. Brigita Zorec, communications manager at Aerodrom Ljubljana, which was acquired in 2014 by the German Fraport AG, underscores how "training of the employees plays an essential role in their empowerment. There are still some major challenges in front of us, for example establishing the Fraport Aviation Academy, a new strategy and masterplanning, further human resources development, rebranding of the company, and new tariff scheme for our services." Policy could do more to attract back talent that has gone abroad, especially the one that left with disappointment. In institutions there are very talented people, but not often at the right place. Internationalization of management is another crucial aspect that could be improved through FDI. Mr Skočir maintains that also the government has adopted a series of measures to support development through FDI, as the highest level of internationalization and international cooperation. "These measures reduce unemployment, facilitate knowledge and technology transfer, and contribute to balanced regional development".

Economic Zones for Regional or Industrial Development Another way to attract FDIs is granting special statuses to specific areas or promoting a regional development model. The benefits a company gains by special conditions to invest may mean it can produce and trade goods at a lower price, aimed at being globally competitive. By this token, the area will see increased trade, investment, and benefit with job creation. In the words of Matej Skočir, "the government has assigned a special status to four administrative regions – Pomurje; Pokolpje; Maribor with surroundings; and Trbovlje, Hrastnik and Radeče – where unemployment has hit hardest, so that they may benefit from the temporary development support measures. Exports have been a leader out of the economic crisis also in the past, and by participating in global value chains, enterprises from these parts of the country will be able to build on their resources, knowledge and experience of their people. Investors proposing to set up greenfield or brownfield operations in these regions enjoy special benefits when they apply for co-financing from the national development funds and the EU Cohesion Fund," which aims to reduce economic and social disparities and to promote sustainable development. However, this is not enough. According to Mr Lanišek, "we should start thinking of Slovenia as a macro-region, we are small and if the model works then we should apply it to the whole country. Keeping in mind that attracting FDI means fundamentally facilitating Slovenians to stay in the country rather than looking for opportunities abroad." Mr Bruhn offers a complementary view to this one: "the regional concepts of growth have been well defined in certain areas of Slovenia, while in

others suffer from the lack of vision. For example, the hospitality and tourism sector on the coastline, remain in the hands of individual private owners, some without any strategy and/or mid or long-term goal." Mr Gorjup adds another perspective on the topic of regional funds: "when it comes to the EU funds, we have such heterogenic industry that only a few sectors are eligible for them, among which there is education. So far I think that a lot of funds have been misallocated or, better yet, unproductively spent, with the only notable exception of the automotive industry. However, I hope that with education as one of the areas where these funds are spent, things will soon improve". Another often-mentioned problem is about acquiring industrial locations. Access to business premises and land, especially for industry, obtaining clear title to land, acquiring the necessary permits to build and operate a factory, are often complex and time consuming. Problems stem from the high price and low availability of land and industrial and business premises in general. "One of the tools of SPIRIT is www.investslovenia.org, providing all the necessary information about Slovenia. An important part of this website is the application called locations, a voluminous database with the data of existing economic zones, their ownership, spatial planning and economic and utility infrastructure of the individual zones. Currently there are data about 200 such zones, and the database is frequently being updated. There are infos about size, distance to highways/railways, electricity, fresh and utility water, as well as the price. Everything is available to users in 5 languages, and the majority of viewers are from Italy, followed by users from Germany, the U.K., the U.S., Austria and Slovenia, with an increasing interest from India, Russia, Poland and Croatia", Skočir remarks. Autumn Edition 2016 | The Slovenian Times

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Slovenia Investment Insight Lesson Learned By forgoing privatization in the past, Slovenia missed out on the multiple benefits that the injection of foreign capital usually brings, including the introduction of new technology and new managerial input. This is a consideration ex post, which does not take into account the circumstances and conditions existing at the time of the transition. However, a good opportunity, especially the possibility of buying a company in the privatization process, and good previous cooperation between the prospective foreign investor and a target company are important stimulators for a foreign company to decide to invest. Slovenia has lately seen perhaps too few of these opportunities, and mostly in the form of M&As, if not pure takeovers. The largest recent FDI inflows are the post-privatization takeovers (Goodyear, Ljubljana Airport) or classic takeovers (Lek-Novartis, Simobil-Mobilkom, SKB-Societe Generale, NLB-KBC). As Tina Videgar, responsible at SAP for integrated communication Central and Eastern Europe, puts it: "In order to fully embrace the potential we have in Slovenia, there needs to be an orchestrated approach, from educational system, to taxation, connectivity, and a clear strategy where this is going. These are key factors that here at SAP we take into great consideration when we are deciding for investments in a given country. In every local market where we operate we are committed to getting involved in digitalizing the local society and environment, connecting cross-regional and crosscountry projects, giving opportunities to young people with ideas and sometimes even building up their business".

Where next? When a foreign investor makes a decision to relocate or restructure abroad, s/he is confident that with the given production technique s/ he will achieve approximately the same productivity as at home but at lower labor costs. In other words, prospective foreign investors are looking whether the conditions that enable achieving the required level of productivity are in place. Likewise, it is normal that all governments face temptations to compromise sound long-term policies to meet shorter-term or narrower goals. Building credibility requires mechanisms for governments to commit to sound policies, as well as discipline, persistence, and a solid mandate from voters. FDI is strongly attracted to high-growth economies. Despite an uncertain business environment and geo-political risks, investors continue to see Europe as a relatively safe haven, with 82% expecting investment prospects to improve or remain the same over the next three years, according to the Ernst & Young

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survey. Success breeds success and to attract high volumes of FDI, locations need to create the conditions for strong economic growth and development to take place. In Slovenia, success stories are mainly linked to long-term strategies, not so much determined by cost assessments as by other competitive advantages such as areas of expertise, human resources, infrastructure and geographical position. However, Slovenia has an ambivalent attitude towards FDI, which swings between openness and caution to foreign investors. 2015 was the first year of optimism for business environment. Among foreign investments the feeling is increasingly positive, and to keep the pace with this renewed optimism, "we should keep it simple: let’s write the rules and respect them", Mr Lanišek concludes. There are some similarities with the Visegrad countries. The Jaguar Land Rover investment in Slovakia is an epitome of favourable investment policies and conditions. Slovakia is the third most open economy in the EU, highly dependent on export and FDIs. Slovak export success is based mainly on large companies in the automotive and consumer electronics sectors. Within the Visegrad Four framework, Slovakia enjoys some forms of inter-country cooperation that facilitate investments and open up a wider market. By the same token, Slovenia could identify similar conditions both within its borders and in the Western Balkans, where countries on the doorstep of the EU represent a "strategic region with huge untapped potential", using the words of Violeta Bulc, the Slovenian European Commissioner for Mobility and Transport. In the wider, Central-, Southern-Eastern European region the good examples to emulate abound. As Boštjan Gorjup puts it: "in Slovenia there is a lack of clear and steady investment incentive programs, while in places such as Poland, Romania and Serbia they are well established and functioning. For example, in Romania investors in specific economic zones get a definite percentage of dedicated funds, with a simple procedure and depending on their own initial investment. We tend complicate too much, beside transparency should be improved." As cheap labor force is not nearly enough, factors of holistic international competitiveness of individual countries are coming into the foreground. This competitiveness is becoming more and more connected with educated labor force, quality of environment and living conditions, as well as credibility and flexibility of state administration. For the country, focus versus fragmentation of resources and proper marketing are crucial. That means that the investment proposition idea needs to be qualified and supported. Besides, it should take into consideration all of the connected environment and make it visible to the investment that needs to be attracted.

To say that high levels of investment and efficient allocation require a good investment climate is a tautology. The policy question is to identify the precise conditions that make up a good investment climate, around which the consensus is that it is characterized by standard good governance requirements together with the adequate supply of certain types of infrastructure. Good governance in turn is measured by the stability of property rights and, according to some, the depth of democracy and public accountability. To put it very simply, a great name, an important group, which would select Slovenia for its next investment would significantly promote Slovenia and prove that there is a solid infrastructure and ideal conditions for investing in the country and going big here. A symbolic example that would make more than a million words. 

Snapshot view of FDI attraction capacity in Slovenia Why You Should Choose to Invest in Slovenia Slovenia has many strong points, among them: • An easy access to regional markets, being geographically located in the center of Europe; • A qualified workforce; • A good quality of life; • Economic and political stability: • Quality infrastructure. Among the challenges that Slovenia still has to face there are: • Low workforce mobility; • High social security contributions from salaries; • A small domestic market; • Several formal and informal barriers to FDI, including a high taxation system. Simplify wherever possible: the general perception by the business community suggests the value proposition of Slovenia is unclear to attract FDI. Maintain stability: value proposition needs to stay the course to continue to be the object of attention from business, investors and its own citizens. Encourage innovation: The role of governments is essential in incubating innovation, investing in education and providing coordinated support for high-potential innovation.


Slovenia Investment Insight Q Where do you see the biggest future opportunities in terms of growth? In what branch of the service you currently provided? A Definitely logistics and the port business, and the internet of things (IOT) related to it. Logistics platforms and nodes are becoming more and more important for economic growth and the prosperity of every single national economy. IOT, with all kind of sensors attached to monitor externalities, which are a mere fact in this sector, will be the key to neutralise the negative effects on our day to day lives.

Gregor Veselko, CEO Actual I.T.

Interview: Gregor Veselko, CEO Actual I.T.

From one port to the other, Actual I.T. goes global Actual Group has been offering IT solutions for 20 years and ranks among the leading providers of IT outsourcing services. The company is now part of the DBA Group, characterised by the synergy of engineering & architecture and ICT, a combination that enables the group to move freely and grow in national and international markets, and to independently pursue business opportunities. It was not a coincidence that DBA and Actual joined forces as they share common values and goals. At the helm of Actual I.T. there is now Gregor Veselko, the dynamic former president of the board of Luka Koper d.d. Q Actual I.T. was acquired by the Italian firm, DBA Group. What was the most attractive selling point? A I would say the most interesting point was the foreseen synergies to be gained by this merger. Both companies were very active in the international market with no overlap, meaning that, in a moment, we gained broader market coverage. Q From a foreign investment point of view, what was the main driver to bring DBA Group to Slovenia? A It was actually a part of the strategic path. The fact is that the IT segment in their business was becoming very substantial and they recognised the vast references Actual had in the port and maritime sector and in particular,

the significant development potential which is hidden in our human resources.

Q Actual I.T. recently acquired five information development systems in Azerbaijan. What does this mean in terms of international growth? What are/were the biggest challenges? A First and most importantly, this is recognition for our people and the products/services we develop for the market. And secondly, it is an important step forward in terms of spreading our reach. Baku in Azerbaijan is situated in the Caspian area where huge investments by the big players, such as China, have been recently injected in to logistics infrastructure. The biggest challenge is to cope with the increasing expectations of our current and future clients in that area.

Q How would you describe/rate the government incentives to invest in Slovenia? Where do you think there has been the biggest improvement? A Paper holds everything…but when it comes to reality things change a lot. We might be an attractive business environment for foreign investors but look at the bureaucracy they face when they try to enter. Look what it takes to build a simple warehouse for instance…I am sure we have lot of room to improve, starting by reducing the stupid legal and formal procedures. Q What is your opinion of Slovenia’s industrial policy, if any? Do you think a masterplan in this regard will favor the business environment? A Frankly speaking, I am fed up and have lost confidence in all these policies. Instead of improving the business environment, we see it worsen. My personal opinion is that such papers must not be produced by people who have never ever in their lives seen and don’t understand a balance sheet or the P&L (profit and loss) statement of a company… Mr Veselko says a few words about the I.T. services industry in Slovenia and at large: We have very good insight in to the IT trends in the world, the educational and professional level of people working in the field is also good. On the other hand, we tend to lack international experience in the sense of having people working on large international IT projects and lack self-confidence when promoting new ideas and projects.  Actual I.T. Plant

Autumn Edition 2016 | The Slovenian Times

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Slovenia Investment Insight

Revoz Plant in Novo Mesto

Interview: Joly Raynald, Revoz CEO

An iconic investment that is doubling its bet in Slovenia Revoz is the only car manufacturer in Slovenia and the only European plant manufacturing the New Twingo (3rd generation) and the Smart ForFour for the German partner Daimler. The company is owned by the French Group Renault, and it has held its position among the biggest Slovenian exporters. The Revoz plant is entirely incorporated into the system of the Renault Production Department, which links all its all its manufacturing plants all over the world. These impressive achievements are the result of constant investments both into the production facilities and talent pool. Below there is an interview with Joly Raynald, Revoz CEO since August 2016.

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The Slovenian Times | Autumn Edition 2016

Q Revoz is one of the oldest foreign investments in Slovenia and one of the largest Slovenian exporters. What is your feeling about the business environment in the country? A Renault has been present in Slovenia for 45 years and continues to invest in this plant because it is a plant with the highest skill level, very efficient in terms of quality and results. Some of the iconic Renault models produced in Novo mesto – such as the Renault 4, Renault 5, Clio I, Clio II and Twingo II - have accomplished major success in the global market and contributed significantly to the Slovenian economy. Q After a month in Slovenia, what is your feeling about Revoz, both vis-à -vis the Renault group and the local community where you operate? A I had some information about the Revoz plant before I came to Slovenia and, after a month spent in this company, I must say that this information has been confirmed. Revoz is an efficiency-oriented plant; the employees are very competent and pragmatic in their working activities. This is also one of the reasons why Revoz has a very good image within the Renault Group. As far as the relations with the local community are concerned, I believe they are good, I have the impression that Revoz is very well accepted by its environment and I really hope that we will make these bonds even stronger in the future.


Slovenia Investment Insight Revoz is an efficiency-oriented plant; the employees are very competent and pragmatic in their working activities. Q What are your priorities in terms of investment? What are the biggest challenges for Renault in the regional market? A First, I have to point out that Renault has made some massive investments in Revoz: just a few years ago, more than EUR 350m was invested in to the production of the Twingo III and Smart ForFour on a new platform shared by the Renault-Nissan Alliance and Daimler;. only three years later we are investing again, this time in the production of the Clio IV, which will start at the beginning of next year. It is clear that Renault would like to maintain this plant as a strategic plant in the small and medium car segment. Revoz is 99 percent export-oriented and has been one of the biggest Slovenian exporters for more than 20 years. Our markets are mostly the most competitive ones: France, Germany, Italy … This year we also started the production of the Smart ForFour for the Chinese market. Even though the local market does not represent an important share in our production, we aim to maintain our leading position of Renault in the Slovenian car market.

Q What do you think of special economic zones in order to favour growth and development in some areas of Slovenia? A As I understand it, Novo mesto is a part of the Dolenjska and Bela Krajina region, the second most developed region in Slovenia. We have built strong relations with local companies and within the local Chamber of Commerce. Together we defend our interests, currently mostly in terms of the infrastructure (for example, the new motorway called the "third axis of development", the quality of electricity, the quality of drinking water …). Every type of organisation that can contribute to better economic conditions for the company is good, as long as it gives results.

Q What is your opinion of Slovenia’s industrial policy, if any? Do you think that a similar, Revozlike investment would benefit the country? A I think it is a little bit too soon to have a solid comment on the Slovenian industrial policy. I have an impression that the strategy is quite efficient. You have some very successful big companies in the fields of pharmaceuticals

Raynald Joly concludes by saying a few words about the automotive industry: "It is an important pillar of Slovenian economic growth. Today, it already represents nearly 20 percent of national GDP. I think that the Slovenian government should maintain this industry in its strategic plans and continue to support some crucial projects that can become a breakthrough for the national economy." 

and the automotive industry and on the other hand, some very successful small companies and startups. However, there is still some room left for some automotive suppliers, for instance. This is something that Renault would also be interested in, since we see that exposure to different risks is smaller when the tissue of the local suppliers is strong.

Joly Raynald, Revoz CEO

Every type of organisation that can contribute to better economic conditions for the company is good, as long as it gives results. More than EUR 350m was invested in to the production of the Twingo III and Smart ForFour on a new platform shared by the Renault-Nissan Alliance and Daimler;. only three years later we are investing again, this time in the production of the Clio IV

Autumn Edition 2016 | The Slovenian Times

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Politics

Political Overview Prepared by Valerio Fabbri

The "silly season" has not left Slovenian politics without news. The time when everybody is supposedly sleepy was marked by several events which will mean a "hot autumn". The last quarter of the year is therefore promising to be quite hectic in Ljubljana’s political circles, with the migrant issue and the privatisation process looming large. The first shock came in mid-July when Dr Dušan Mramor submitted his irrevocable resignation as Finance Minister, for personal reasons, when there were widespread rumors about his health. Dr Mramor insisted that his decision was based exclusively on his wish to return to the academic sphere. It is interesting to note that, earlier this year, Mramor’s academic endeavors led to his resignation during a political spat about his "extra pay" for remaining available as an economics professor. While Prime Minister Dr Miro Cerar rejected the resignation, there was little he could do other than see his strongest minister leave together with his international credibility. Under Mramor’s tenure, Slovenia exited the excessive deficit procedure and was removed from the list of countries with excessive macroeconomic imbalance, resulting in improved credit ratings. To replace the "European Finance Minister 2015", the Prime Minister nominated the state secretary, Mateja Vraničar Erman, a legal expert who has worked at the Ministry of Finance since 1993 and who had been a state secretary for the previous six years, dealing mainly with taxes and budget issues. It is a decision for continuity, although it is yet to be seen whether Erman’s political neutrality is positive. After all, the government’s mission to cut the deficit to zero by 2020 needs to be balanced against the demands for public sector wage and pension hikes. Vraničar Erman will have to follow the path of fiscal consolidation while managing the economy - easier said than done. Around the same time, the Interior Minister, Vesna Györkös Žnidar, had extra work. In addition to a shocking attack on medical staff at the general hospital in Izola which left three people dead including the assailant, Györkös Žnidar, the Minister also had to face mounting fears around the reopening of the migration route. The Ministry claimed that Slovenia would adopt extreme measures and not become a forgotten pocket filled with migrants, despite the open questions at the European level. The political conundrum about the European Union (EU) lacking both a vision and the tools to counter the migration crisis was widely discussed during the successful Bled Strategic Forum with, among others, the Turkish Foreign Minister Mevlut Cavusoglu. The Minister did not use diplomatic language to address the EU’s failure to counter the open issues on migration or the EU’s fragility and incapacity to face the new international challenges. If the Turkish minister used the occasion to bluntly lay out his country’s stance, the Russian President, Vladimir Putin, took a different approach. Despite some stark differences on certain pressing issues, Putin reinforced the traditional friendship between Slovenia and Russia during his July visit to the Russian chapel on the Vršič pass, to commemorate the 100th anniversary of the chapel. Ex-post it could be said that it was "much ado about nothing" because the widespread fear before the visit of potential repercussions from Putin’s visit turned out to be unjustified - the Russian President used soft language to reiterate the importance of dialogue. 

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03 PHOTOS 01 The state secretary at the Ministry of Finance, Mateja Vraničar Erman; Photo: Nebojša Tejić/STA 02 Turkish Foreign Minister Mevlut Cavusoglu's address at Bled Strategic Forum; Photo: Nebojša Tejić/STA 03 Russian President Vladimir Putin's address at the Russian chapel on the Vršič pass, during his visit in July. Photo: Daniel Novakovič/STA


Politics Dr Danilo Türk

The fate of our planet depends on the sustainability of development pursued by human beings "Those of us who knows the UN will never forget some of our friends, our colleagues, who lost their lives in the line of duty. For my entire life, I will remember colleagues like Sérgio Vieira de Mello, Fiona Watson, Richard Cooper, Nadia Younes and many others, who lost their lives in Bagdad on 19th August 2003. I hope you will understand that for someone who has worked in the UN long, people who risk their lives and some people who lose their lives in the line of duty, they are the main heroes of the organization." Said Dr Danilo Türk, candidate for UN Secretary-General (SG) in April 2016, at UN Headquarters in New York at the third and final session of informal briefings for the position of the next UN SG. He was the first Slovenian Permanent Representative to the UN (1992-2000) and served as a non-permanent member of the Security Council (1098-99). He served as the UN Assistant Secretary-General for Political Affairs from 2000 to 2005 and then returned to Slovenia to become a Professor of International Law and the Deputy Dean of Student Affairs at the Faculty of Law, University of Ljubljana. He was elected as the third President of the Republic of Slovenia in 2007 and served until the end of 2012. In January 2014, the Slovenian government nominated him as its candidate for UN Secretary-General. The UN is 70 years old and the current SG, Ban Ki-moon, is the eighth occupant of the Organization’s history. He took office in January 2007 and will be ending his 10-year tenure on 31 December 2016. In accordance with the UN Selection procedure of next Secretary-General, candidates presented their Vision of statement, which address the challenges and opportunities facing the UN and the next Secretary-General to lead the 193-member Organization. "The UN needs a strong moral commitment to its original purposes and objectives in its effort to reduce and eliminate extreme poverty, to ensure sustainability of economic and social development, to strengthen human dignity and rights and to prevent violent conflicts". Dr Türk points out in the introduction of his Vision of statement that

addresses three vital partnerships, which the SG must develop to achieve real results. "First, the UN and its Secretary-General operate in a world whose peoples are organized in sovereign states and are represented by their governments. Sovereignty increasingly means responsibility and is essential for the further evolution of the rule-based international system. Second, the evolution of international cooperation since the creation of the UN has given rise to numerous regional organizations which, over time, have become an integral feature of the international system and vitally important partners of the UN. The Secretary-General must coordinate closely with these entities to develop strong partnerships. For example, working closely with African Union deserves special attention, in particular in the field of peace-keeping. Third, in the world of the 21st Century, the Secretary-General must be able to relate effectively with protagonists that present opportunities and challenges beyond the realm of governments. The vision of the Secretary-General must encompass the legitimate expectations of civil society, the private sector and academia that play key roles in this age of global communications and global economic interdependence and should be involved in the realization of the global vision of the UN."

and must use all avenues for good offices and fact-finding in a wise and timely manner. "Social cohesion and sustainability of peace must be the ultimate objectives of post conflict peace building lest situations of fragile peace relapse into wars." In the area of sustainable development dr Türk stresses the adoption of Agenda 2030, including its Sustainable Development Goals, and the recent Paris Agreement under UNFCCC, where SG should play a catalytic role in the process of implementation of these agreements with the involvement of civil society, the private sector and academia. "Ultimately, the fate of our planet depends on the sustainability of development pursued by human beings. Resources, especially water in arid or overpopulated areas, must be used wisely and for all." Finally, dr Türk sees human rights and humanitarian work in the center of UN’s moral purpose. "Critical humanitarian activities must be assigned a high priority in an effort to address the dramatic humanitarian and migration problems that have arisen." In addition, he points out the women’s rights are central to achieving any part of his entire vision. "Women can and will play a strongly positive role in all fields. The SG must be committed to the strengthening of their roles and responsibilities - in all UN policies and programs as well as at all levels of UN decision-making." 

Dr Danilo Türk, as a Slovenian candidate for the position of UN Secretary-General. Photo: Xinhua/STA

In the Vision of statement dr Türk furthermore emphasizes three key areas of work: Maintenance of international peace and security, Sustainable development and Human rights and humanitarian work. The candidate believes that maintenance of international peace and security is a fundamental activity of the UN and therefore the SG must take initiatives to help governments to confront emerging threats to international peace and security Autumn Edition 2016 | The Slovenian Times

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Politics

01

Bled Strategic Forum 2016

We need to channel our collective energy Prepared by Ivona Victoria Moro

Organised by the Ministry of Foreign Affairs of the Republic of Slovenia and the Centre of European Perspective, the 11th Bled Strategic Forum was attended by government officials and leading private sector figures. At this year’s forum, much of the debate was centred on European integration, security and the future, and unique solutions. There were many views and positions on these key areas expressed by those representing our international community.

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On behalf of Ban Ki-Moon, Secretary-General of the United Nations, Michael Møller, Director-General of the United Nations Office in Geneva, shared the keynote address, setting the general tone of this year’s Bled Strategic Forum: "We need a change of mindset and we need to channel our collective energy," and to "stress the common vision of solidarity to set the future tone" stated Karl Erjavec, Deputy Prime Minister and Minister of Foreign Affairs of the Republic of Slovenia, in this year’s introduction to the forum.

Safeguarding a European Future As Kolinda Grabar-Kitarović, President of the Republic of Croatia, stated in the leaders panel: "We need to be open and be clear in defining what our policies are" and "we need a firm stance and firm action." It is vital to ensure long-term stability and security to build a truly integrated European future, perhaps a reassessment of aspects of the status quo of security is preferential. Borut Pahor, President of the Republic of Slovenia, highlighted that the European Union is currently facing a critical point to either preserve it or build on it and that this


Politics When you come to hard security and the terrorist threat, the Brussels institutions are not really a major part of the solution. is a "tough crisis for Europe." Karl Erjavec called for a "strong and integrated European Union" and stressed the importance of "burden-sharing." The rapid and effective adaptation of efficient defence and security structures to manage the current geostrategic reality within and outside of the European continent are vital to further ensure common values and appoint prerequisite standards for securing a European future. Undoubtedly, enlargement can be pinpointed as a key success of EU policy. Nevertheless, external circumstances have created new challenges within the EU framework, where political dialogue must be enhanced to create sustainable progress and quickly adapted to the ever-changing circumstances. The 'European Union: Integration vs. Disintegration' panel discussion, where Vijay Rangarajan, European Director in the Foreign and Commonwealth Office for the United Kingdom, shared his view that "when you come to hard security and the terrorist threat, the Brussels institutions are not really a major part of the solution. The real hard work is done between nation-states and that is the fact of today’s cooperation." French Minister of State for European Affairs, Harlem Désir, shared his view that we need "the capability to answer to these issues." PHOTOS 01 Prime Minister of the Republic of Albania Edi Rama, President of the Republic of Croatia Kolinda GrabarKitarović, President of the Republic of Slovenia Borut Pahor and Canadian Senator George Furey at BSF 2016. Photo: Daniel Novakovič/STA 02 Introduction to the BSF 2016 by Karl Erjavec, Deputy Prime Minister and Minister of Foreign Affairs of the Republic of Slovenia.; Photo: Tamino Petelinšek/STA 03 BSF 2016 – EU remains an attractive pull factor for the countries of the Western Balkans; Photo: Tamino Petelinšek/STA

Brexit was not a surprise The post UK referendum framework for Europe is one very central feature for questioning the future of European Integration. Vijay Rangarajan made it clear that Brexit should not be seen as a crisis but rather, as a different path for the United Kingdom to look forward too. The decision undertaken by the people of the United Kingdom to leave the EU is, however, echoed among a number of EU Member States. Perhaps, as Dr Nik Gowing, International Broadcaster and Visiting Professor, King’s College London put it, "Brexit was not a surprise."

Importance of globally sharing information Key officials also pointed out the growing influential impact of digital transformation. Edi Rama, Prime Minister of the Republic of Albania, commented on the "loss of control" which is brought about by the digitalised world, bringing new threats to the international community. Borut Pahor highlighted the importance of "globally sharing information to deal with the immediacy" and eradication of rising issues. The progressive and varied use of technological means in various spectrums is growing and it is important that rising threats are countered in a similar manner. Of key importance is also the future of energy geopolitics, where representatives of government, the private sector and international institutions centred their discussion on the key issues central to the annual Global Survey published by the International Energy Agency. Ambassador Mary Warlick, Principal Deputy Assistant Secretary for the Bureau of

Energy Resources, US Department of State, highlighted that the US has "been working closely with Member States, the European Commission and working through the US-EU Energy Council on what countries need to do to achieve energy security goals." She added that "a very important objective remains Ukraine."

The Western Balkans are in different phases Arising from the aforementioned challenges for the EU, the final discussion at the forum questioned whether the EU remains an attractive pull factor for the countries of the Western Balkans. US Deputy Assistant Secretary of the Bureau of European and Eurasian Affairs, Hoyt Yee, explained that "all the countries in the western Balkans are in different phases, some are advanced, others very much behind." In discussing enlargement, "there has to be a more urgent approach to meet the requirements" and "we have a tremendous will of the people to join the European Union, but we have politicians who are not." "There have to be consequences for those that are obstructing the process of integration or reform." Professor Dejan Jović, Professor of International Relations and Head of Department of International Relations at the Faculty of Political Science, University of Zagreb, Croatia, stated that in the case of Bosnia and Herzegovina, "it will not reform, it’s not because they don’t want to reform, but because their system was set up by external forces," expressing that becoming part of the EU is becoming less likely. 

We have a tremendous will of the people to join the European Union, but we have politicians who are not.

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Autumn Edition 2016 | The Slovenian Times

39


European Union Politics Interview: Corina Crețu, European Commissioner for Regional Policy

The Energy Union is one of the top priorities of this Commission Prepared by Tina Drolc, M.Sc.

Regional policy is the most important investment tool of the European Union and, as Commissioner Crețu points out, high on the agenda are investments in growth-generating sectors such as research and development, support to SMEs, digital technologies and the low-carbon economy. As she explains, the Energy Union is one of the top priorities of this Commission which will help decrease energy imports, diversify our energy sources, tackle energy poverty and cut emissions. policy and one of the pillars of the EU’s growth and jobs agenda. We invest in key, growthgenerating sectors: research and innovation, support to SMEs, digital technologies and the low-carbon economy. Over EUR 38bn will be invested in the latter in 2014-2020 in order to reach energy efficiency targets in all Member States, which is double the allocated amount for this objective in the previous funding period. Over the next few years, thanks to Regional Policy investments, we expect to see 875,000 households benefit from thermal renovation

and what implications does this have in terms of EU energy security and competitiveness? A The Energy Union is one of the top priorities of this Commission. Its ambitious strategy is to boost our energy security by integrating all our national energy markets into one which is rich in renewables and new technologies and which is highly energy efficient, making use of the latest research and innovation. In line with this strategy, EU investments will help decrease energy imports, diversify our energy sources, tackle energy poverty and cut emissions.

EU investments will help decrease energy imports, diversify our energy sources, tackle energy poverty and cut emissions.

Corina Crețu, European Commissioner for Regional Policy

Q With regard to green growth, the EU will invest more than EUR 38bn in the low-carbon economy, twice the amount spent during the previous funding period. What are the expected outcomes? A Now, 40 years since the creation of the European Regional Development Fund (ERDF), Regional Policy is a fully-fledged investment 40

The Slovenian Times | Autumn Edition 2016

work, more than 57,000 companies operating with improved energy efficiency and 3.3 million additional energy users connected to smart grids. Overall, Regional Policy programs will contribute to a decrease in estimated annual greenhouse gas emissions of around 30 million tons of CO2 and will support the production of more than 7,500 MW of additional renewable energy capacity – almost equal to the total electricity capacity of Slovenia and Croatia combined. These investments will, at the same time, benefit regional development and economic competitiveness, while also tackling energy poverty and lowering electricity bills for EU citizens.

Q How do EU Structural and Investment Funds help in establishing the European Energy Union

The EUR 38bn earmarked for investments in the low-carbon economy will help Member States, regions, local governments and cities implement much needed investments in energy efficiency in buildings, renewable energy, smart grids or sustainable urban transport. I hope that our investments will help change mentalities and behaviours. For example, motivating people in cities to switch from cars to public transport requires investment into efficient and modern public transport systems and here, the ESI funds play a key role.

Q Which financial instruments has the European Commission recently adopted for the European Structural and Investment (ESI) Funds to facilitate access to funding for young businesses and urban development project promoters? A Over EUR 20bn from the ESI Funds for 2014-2020 are expected to be used through fi-


EuropeanPolitics Union I encourage Slovenia to join the SME initiative, alongside Spain, Malta, Bulgaria, Romania, Italy and Finland.

nancial instruments in investment areas ranging from SME support, energy and resource efficiency, information and communication technologies, sustainable transport, research and development, and innovation. Financial instruments, with their multiplier effect, have best proven their ability to boost the impact of EU investments. This is the reason why I encourage Slovenia to join the SME initiative, alongside Spain, Malta, Bulgaria, Romania, Italy and Finland. Improving access to finance is crucial to SMEs as it is the lifeblood of entrepreneurship. This initiative is especially designed to provide fresh lending to businesses. To further help small businesses, we have created five, ready-to-use financial instruments called "off-the-shelf". Already compliant with state-aid rules and ESI fund regulations, they are designed to increase the take-up of such innovative instruments across Europe. These instruments also aim to provide SMEs with better access to finance. We have designed a risk-sharing loan based on the sharing of risks between public and private resources, a capped guarantee instrument where public money acts as the guarantee against default, and a co-investment facility to provide funding to startups and SMEs. Other instruments support energy efficiency projects in residential buildings and urban development projects. Finally, I want to emphasise the huge benefits that could be gained by combining the ESI Funds with the European Fund for Strategic Investments, the heart of the Investment Plan.

Q How will EU regional policy change after Brexit and how will the effect of funding regional and cohesion policy be adjusted as the UK is one of the largest EU budgetary items? A It is far too early to speculate on this as on any other question related to the impact of the outcome of the referendum. These will be addressed in due course, once negotiations with the UK begin on its withdrawal agreement as well as on the agreement concerning its future relationship with the EU. For the time being, the UK remains a Member State of the EU with the same rights and obligations as the others. Q The number of refugees and asylum-seekers looking for a job in the EU is getting larger while the employment possibilities in Europe are not very strong. Many of these people are also focused

Š European Union , 2016 / Source: EC - Audiovisual Service

on a particular country (e.g. Germany). How does the EU approach this? A I believe we can turn the migration challenge, one of the biggest challenges we have ever had to face as a union, into an opportunity. Integrating third-country nationals, who have a right to stay in the EU, as soon as possible is economically beneficial for all of us. Investing resources and energy in to integration policies today will contribute to making Europe a more prosperous, cohesive and inclusive society in the long run. For this, it is essential to speed up the administrative procedures, to allow fast access to the labour market and to provide the basic preconditions such as housing, healthcare and language training. Existing qualifications and skills should be evaluated and recognised as far as possible. It is well-known that migration is largely an urban reality. Every day, cities are confronted with concrete challenges involving migration. Whether it is housing, education or employment; cities are at the forefront of the EU response to these challenges which is why I have launched a direct dialogue with the mayors of major European capitals in order to see how we could strengthen the integration of migrants in cities.

Q You recently said about EU social integration, "It is important to avoid ghettos and segregation. Social inclusion is not only for migrants, but it is now the most important issue". What is the plan to execute this? A Social inclusion is indeed not only for migrants and it is clear that integrating migrants should not be at the expense of other vulnerable groups in our societies, but in complementarity: we want to make the EU in its entirety

stronger and more cohesive. What I meant was that the cost of not integrating migrants will be far greater than the resources dedicated to their social and professional integration. Segregation should be avoided at all costs. We can help these people find their place in society and give them a future in Europe. Cohesion Policy plays a crucial role here as we have already co-funded thousands of social inclusion projects. We are ready to further promote integration by financing projects in social and educational infrastructure, housing, childcare, health, but also business startups, language courses and professional training. The Cohesion Policy also invests in the regeneration of deprived urban areas and in measures to reduce spatial and educational isolation. Where desired by local authorities, these investments could even be packaged into an integrated urban development program. Finally, let me mention that under the 2014-2020 Cohesion Policy framework, EUR 15bn from the ERDF will be directly handled by cities. One of the objectives of the direct dialogue that I set with the mayors was also to help them fully exploit the potential of the funds for quality projects that will contribute to a smart and inclusive growth in our cities. ď ´

Integrating third-country nationals, who have a right to stay in the EU, as soon as possible is economically beneficial for all of us.

Autumn Edition 2016 | The Slovenian Times

41


European Union Politics

01

Brexit fears Prepared by Maja Dragovič

Since the United Kingdom voted to leave the European Union in June, Theresa May, the UK’s new prime minister, continues to say that "Brexit means Brexit". It has almost become a mantra. However, apart from the fact that UK will no longer be a member of the European Union, nobody knows exactly what "Brexit means Brexit" means.

In the aftermath of the referendum result, most financial experts slashed their growth expectations for the UK dramatically, with many forecasting an outright contraction in GDP for two quarters - a technical recession. The immediate signs were indeed pointing to troublesome economic times ahead. The British pound tumbled against the US dollar to its lowest level since 1985. Leading financial institutions announced that they would probably move some of their operations from London’s City district to Germany and France. Worrying news considering the financial powerhouse generates 22 percent of the UK’s GDP. However, in the two months since the referendum, Britain’s economy continues to bounce back from the initial shock with two positive job and housing surveys, both of which had pointed to a gloomy outlook one month postreferendum. Consequently, both Morgan Stanley and Credit Suisse scrapped their forecasts that the UK would go into recession following the Brexit vote.

Political turmoil Though any economic consequences may have been overrated or delayed, the political fallout is all too apparent. While the remaining 27 members of the EU are urging the UK to trigger Article 50 of the Lisbon Treaty - which starts the formal two year "divorce" negotiations without too much delay, Theresa May is not in a hurry, insisting that she will not trigger it before the end of the year at the earliest which is understandable since the UK has a lot of

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The British pound tumbled against the US dollar to its lowest level since 1985. negotiations to handle within its own borders and the prime minister has said that the UK has to have a united approach before the exit talks begin. The amount of internal negotiations that will have to take place became evident in the turmoil that followed the result. In the first few days and weeks after 23 June, the UK’s leading political figures from both sides resigned, one after the other, including UKIP’s Nigel Farage, followed by Boris Johnson and finally, the now former prime minister, David Cameron. The process to pick the next UK prime minister was almost as swift and dramatic with a new PM chosen within a couple of weeks of Cameron’s resignation, although it was not expected to happen until September. The opposition itself was also fighting its battles, with many Labor members wanting Jeremy Corbyn to be replaced with a new leader. In Scotland, where the referendum result was in favour of remaining in the EU (62 percent), the first minister, Nicola Sturgeon, announced straight after the results came in that she would not rule out a second independence referendum in Scotland if the UK is to leave the EU. "Scotland is determined to stay in the EU," she said. "I don’t underestimate the challenges that lie ahead for us in seeking to find a path."


EuropeanPolitics Union Morgan Stanley and Credit Suisse scrapped their forecasts that the UK would go into recession following the Brexit vote. In Northern Ireland, where 56 percent voted to remain in the EU, the referendum reignited talks of a unified Irish state. Considering the fears of a disintegration of the United Kingdom, Theresa May has an unenviable task of reaching a deal within her own borders.

Indirect impact In Slovenia, experts expect the UK’s exit from the EU to have indirect effects on the country due to the direct impact it will have on the economic growth of Slovenia’s main trading partners. How large these effects will be is difficult to assess, according to the Ministry of Finance. One of the immediate effects is expected to be on payments to and from the EU budget as well as the impact on interest rates, however, the Ministry stressed the financial position of the country is strong. Slovenia’s Institute for Macroecenomic Analysis and Development (IMAD) says the UK’s decision to leave the EU further illustrates the need to strengthen the resilience of the Slovenian economy to shocks from abroad. "As pointed out for several years, it is necessary to carry out structural and fiscal reforms that will strengthen the resilience of the Slovenian economy to the uncertainties posed by the international environment and enable the economic policy response to such shocks," they warned. Though Brexit has not had any major direct or indirect impact on the Slovenian economy thus far, there are signs that the crisis has had its effects. One such example is that the "non-

The "non-deal road show" in July this year on the sale of the government’s shares in NLB, the country’s biggest bank, was postponed.

deal road show" in July this year on the sale of the government’s shares in NLB, the country’s biggest bank, was postponed "due to the current volatile situation in financial markets", reported the Slovenian Sovereign Holding (SSH). The government has promised to reduce its holding in NLB to 25 percent plus one share by the end of 2017 and is insistent that, despite the delay, the deadline will still be met.

Tough negotiations ahead Meanwhile, the EU27 had its second meeting post referendum. The summit, held in Bratislava on 16 September, was set for "brutally honest debate" on the crises that have reversed the expansion of the European project. Slovakian Prime Minister, Robert Fico, current head of the EU’S rotating presidency, said the informal summit in Bratislava would create an opportunity for honest discussions among the Member States as the EU project faces growing skepticism. "After Brexit and the risks that are associated with it, it is absolutely necessary to meet and to be very honest," Fico told reporters. German Chancellor Angela Merkel warned that the EU faces a "critical situation". "We have to show, with our actions, that we can get better," Merkel said as she arrived at the summit. "I hope that Bratislava shows that we want to work together and we want to solve the problems which we have in Europe," she added. Though Brexit wasn’t the main topic of the summit, the leaders reaffirmed their position regarding the commencement of the exit negotiations with the UK. "Access to the single market requires acceptance of all four freedoms (movement of labour and capital and free trade in goods and services)," the leaders said. "Those who want to have free access to our internal market; have to first implement the four freedoms without exception and I have to add, without nuances," European Commission President, Jean-Claude Juncker added.

03 PHOTOS 01 Financial and Business centre City of London. Photo: Aljoša Rehar/STA 02 London eye and British flags; Photo: Aljoša Rehar/STA 03 UK’s new prime minister Theresa May during her visit to Slovakia. Photo: Xinhua/STA

The migration was at the centre of the UK’s Leave campaign and many voted to exit the EU expecting restriction on the influx of foreigners into the country. Whether the UK’s government will be able to deliver on its promises to its nation and keep its perks in the EU is anyone’s guess. 

Whether the UK’s government will be able to deliver on its promises to its nation and keep its perks in the EU is anyone’s guess.

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Trade between Slovenia and Great Britain: 2010 – 2016 (in € ‘000) Year

Export

2010

2011 2012

Import

450.495

494.862

460.134

2013

2014

Total

Balance

263.862

714.357

186.633

358.452

853.314

136.410

303.432

763.566

156.702

441.171

388.356

829.527

52.815

467.010

306.870

773.880

160.140

2015

534.787

351.125

885.912

183.662

2016*

275.221

183.684

458.905

91.537

Source: SURS, June 2016

Autumn Edition 2016 | The Slovenian Times

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European Union Politics

01

Interview: HMA Sophie Honey, Ambassador of the United Kingdom to Slovenia

Business as usual Prepared by Maja Dragovič

It has been a topic that dominated the summer. The unexpected decision by the British citizens to leave the EU has left everyone stunned and fearful of what impact this decision will have on the future of European Union as well as on Great Britain. However, as HMA Sophie Honey points out, for now it is business as usual.

Q Some see the referendum result as the UK turning its back on Europe. Do you think that is true? A There was quite a lot of debate whether the result meant that the UK, which has historically been very open, diverse, creative country, was somehow turning inward or turning its 44

The Slovenian Times | Autumn Edition 2016

back on Europe. I think that is completely untrue, it is a fundamental misunderstanding of the result. I think the UK will remain a very open, very outward looking country that wants to be active on the world stage and very closely entwined with Europe. The referendum result is about saying that British people decided to

leave the EU but we now need to figure out with European partners what that future relationship with Europe will look like, covering both trade but also cooperation on foreign policy and security.

Q What was the reaction of the Slovenian government after the Brexit vote? A When I was speaking to president Borut Pahor and the prime minister’s Miro Cerar’s team as well as the foreign minister Karl Erjavec, we talked about the 25 years of (Slovenia’s) independence and the positive way that the UK’s relationship with Slovenia has grown and developed over that time and also about the news on the referendum. In a way that was good because it made it very clear to all of us that we wanted the UK’s relationship with Slovenia to continue growing and we would work together to find a way through this both to ensure that we would push for constructive negotiations to deal with it and to find a way forward. Q The negotiations will be tough. On one side, the EU is adamant there will be no access to the single market without the free movement of people, while on the other the UK’s stance is there have to be restrictions to the free movement of people.


EuropeanPolitics Union I think the UK will remain a very open, very outward looking country that wants to be active on the world stage and very closely entwined with Europe.

PHOTOS 01 HMA Sophie Honey, Ambassador of the United Kingdom to Slovenia 02 Ambassador of the United Kingdom to Slovenia, HMA Sophie Honey, speaking to president Borut Pahor; Photo: Nebojša Tejić/STA

A The negotiations haven’t started yet and

British-Slovene Chamber of Commerce is going from strength to strength and it is a great forum for Slovene companies who want to build their links with the UK and learn from others who have done that. The chamber is organising a business conference that will coincide with Slovenia – England football match on 11 October in Ljubljana. Participants will be British businesses active in Slovenia and Slovene businesses who have active links with the UK. One of the speakers will include Glenn Hoddle, former English footballer and manager, cited as one of the most gifted English footballers of his generation. He will be talking about what business can learn from sport. It promises to be a great event. 

there needs to be work and thinking in the UK about the approach we want to have before we trigger Article 50 so that we can then have the best possible negotiations and that will provide more certainty for the UK and for Europe. So all of those issues will have to be considered.

Q The access to the single market is of great concern regarding the future of the City of London, the world’s financial capital. There are fears that if Britain doesn’t secure access to the single market, it will have severe impact on the City. A What is really important is that we are leaving the EU but we are not leaving Europe. We’ve historically had very strong economic relationship with Europe but also there is a lot of cooperation on security. Part of the negotiations will be not just on how we leave but also about the future relationship between the UK and Europe. What is clear is that the UK will need to have a very strong and connected relationship with Europe. That will be a key part of the negotiations: what that economic relationship should look like and of course, the link of financial services is really important part of that. Also what our security cooperation and cooperation on foreign policy issues should look like. I think it is important to be open to those future possibilities and what will be really important in discussions with our partners is that we have constructive negotiations. It is going to be tough and it is going to be super complicated but I think we will manage it.

Q What has happened since the vote to leave the EU? Have you had any concerned calls from UK citizens in Slovenia? A Of course we had questions and concerns particularly from British nationals in Slovenia expressing worry and wanting to understand if there are changes and how that will work in the future. I ended up doing a short video message, which is on twitter, to explain that for now, everything remains the same. We’ll need to negotiate with EU partners about what the future arrangements will be but the British prime minister Theresa May has made clear that she wants to be able to guarantee the status of EU nationals already in the UK so as long as the rights of UK nationals living in other EU countries are also protected. Q What would you say to any Slovenian companies and investors or British investors who are thinking of branching out but are reluctant to make any moves due to the current uncertainties? A For Slovene companies interested in building their links with the UK or British companies interested in exporting more to Slovenia I would say "go for it" because the arrangements now remain the same and I am confident that in the future we will negotiate the arrangements that will enable us to continue building those close trading links. At the moment the

The British prime minister Theresa May has made clear that she wants to be able to guarantee the status of EU nationals already in the UK so as long as the rights of UK nationals living in other EU countries are also protected.

02

Q The Brexit vote has also raised concerns regarding the future of the EU with calls for the Union to change. A The world changes so any successful organisaton has to change and adapt with time. The EU has changed massively since its creation anyway - it has grown and developed. The referendum in the UK has reenergised that debate in a way but I don’t see that as a negative, I see that as a positive thing. From the UK’s perspective, although we will be leaving, the EU will remain an absolutely critical partner for us so we want the EU to succeed and we will want that change to be positive and help bring about the positive developments for the future.

What is really important is that we are leaving the EU but we are not leaving Europe. Autumn Edition 2016 | The Slovenian Times

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Global Pitch

ABC Venture Gates:

Bringing the best global innovations to Munich Prepared by Edina Dyachenko

Slovenia, Germany, Silicon Valley and India next. ABC (Acceleration Business City) is creating a global bridge for startups. As their startups shape their path to unicorns, ABC is also accelerating …. All the way UP! For ABC, which was hatched in Slovenia and quickly gained approval from international investors and corporations, is always providing its startups with the best deal and environment for global growth.

Germany is Europe’s biggest and most commercially advanced market with the title of innovation leader in Europe. After so many years of being closed, the old international airport in Munich is finally experiencing one last landing, in the coming months or years, there will be many more successful take-offs! Opening a new ABC centre for accelerating startups was just a matter of time. Munich, as the number one location of the venture capital industry, seemed the right fit. With that in mind, 30 June was an important day for the Munich startup ecosystem and a new chapter in the ABC success story. During the opening ceremony, an inspiring speech by Jeff Burton, co-founder of Electronic Arts, only confirmed ABC’s track to success. Covering 10,000 square feet, a new entrepreneurial hub known as ABC Venture Gates is an exceptional place for later-stage startups searching for the first-round of investment of up to EUR 5m and second-round of up to EUR 10m. With ABC’s tailored programs, startups can quickly develop and implement effective ‘go-to-market’ solutions. The path of a startup to achieving global recognition is never simple but ABC Venture Gate makes the process much easier. Their global reach and scale connects the right startups on the one side with the right business partners on the other. ABC’s advanced match-making process increases the success rate of investments and provides startups with a constant deal flow. Multinational enterprises from different industries including IBM, Lidl, BMW, Cisco, Microsoft and the largest retail and business center in SE Europe, BTC City, are just a few ex-

amples of ABC’s extensive network of connections, with the most influential partners, that ensures a push in the right direction. ABC is also supported by Harvard and Berkeley universities. It is not just ABC Accelerator that is achieving breakthrough results. Facility, a startup from ABC’s 2015 "Smart Cities" program, recently raised EUR 550,000 of investment from seed fund, Speedinvest. Through user-friendly and a completely customisable mobile management platform, manual hotel operations are no longer needed. Further proof that Facility is on the right track is that hotel maids are eager to use their platform since it is very user-oriented and can be implemented in a day. This solution for smarter management of hotels is now used by more than 100 hotels in five different countries. With a sizeable investment in their pocket and fresh motivation, Facility is now planning to expand to the US market and Silicon Valley. In the past, the US market posed a huge step for startups operating outside of the US - not anymore! ABC is currently in the middle of selecting startups for its new program, IoT & IoE, but the ABC story of development and rapid growth doesn’t stop there. As Dejan Roljič, ABC’s CEO and founder stated during their grand opening in Munich, ABC is starting the next chapter in Silicon Valley with an opening ceremony on 24 September this year. ABC Global Home in Silicon Valley will become an important ecosystem hub for later stage international startups focused on entering the US market and exposing them to Silicon Valley’s wealth of resources and capital.  Photos: Siniša Kanižaj / ABC Accelerator

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International Business Partners

AmChams in Europe 2016 Best Practices Conference October 12 � 14, 2016, Ljubljana � Slovenia

AmCham Slovenia is proud to host the AmChams in Europe 2016 Best Practices Conference for the first time, taking place on October 12–14, 2016 in Ljubljana, Slovenia. AmChams in Europe meet to exchange Best Practices at their two annual conferences. AmCham Slovenia has been chosen to host the European version of the conference. Representatives from 29 AmChams will meet in Ljubljana to share best practices and compete for the Creative Network Award on the topics of membership and management, advocacy and impact, communication, and marketing creative initiatives and programs. The 2016 Best Practices Conference is an opportunity for AmCham Slovenia to showcase Slovenia as a country of prospects

and optimism, to find synergies with other AmChams and expose our members to the AmCham network.

Why sLOVEnia? AmCham Slovenia has the privilege to have its executive director, Aj�a Vodnik serving as Member-at-large in the AmChams in Europe Executive Committee, supporting the work of AmChams across Europe. AmCham Slovenia is one of the most active members of AmChams in Europe, achieving the highest growth in membership per capita and leading by example with reference programs such as Partnership for Change and AmCham Young ProfessionlasTM. Founded in 1963, AmChams in Europe today: ¥ unites 46 AmChams from 44 countries throughout Europe and Eurasia,

¥ represents the interests of more than 17,000 American and European companies employing 20 million workers, ¥ its members account for more than $ 1.1 trillion in investment on both sides of the Atlantic. The AmChams in Europe Network represents a unique opportunity for you to: ¥ gain access to the broad AmChams in Europe Network, ¥ have face time with the executive director in every European country, ¥ cooperate with domestic and foreign businesses, ¥ exchange best practices and experiences with AmCham members across Europe, ¥ become more familiar with the European and Transatlantic business environment.

AmChams in Europe 2016 Best Practices Conference October 12–14, 2016, Ljubljana - Slovenia

Autumn Edition 2016 | The Slovenian Times

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International Business Partners TOPIC: What are your associations and possible related activities with "Brand Slovenia"?

American Chamber of Commerce – AmCham Slovenia

British – Slovenian Chamber of Commerce – BSCC A country’s brand has a huge impact on its awareness as a tourist or business destination. Slovenia still has a lot of room for improvement in building its’ right brand identity to, differentiates itself from its neighbouring countries. In doing business in the UK, we find that Slovenia is not well known which makes it less interesting as a business destination for British brands and investors. To invite more businesses to visit Slovenia, we will organise a large "Sports Meets Business" conference in Ljubljana, combined with the football match between Slovenia and England on 11 October 2016. The conference will host famous football legends, such as Glenn Hoddle, important British industry experts and government officials that will also talk about the consequences of Brexit. We plan to continue this strategy around football in 2017. We hope Slovenia will continue to build on its brand identity and raise its awareness in the UK, which will then bring more British tourists and business. 

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The brand, I feel Slovenia, holds numerous opportunities to place our wonderful country on the world map. However, the brand too often acts only as a catchphrase and there seems to be a lack of ownership among those who should be its biggest ambassadors: the Slovenian people. Promoting the positive, improving what needs to be improved, having pride in our country, bringing together and connecting all members of society through positive stories, is what a group of enthusiastic public servants and Slovenian business men and women set off to do in the Partnership for Change program. In its second year, the program (initiated by AmCham Slovenia and the Ministry of Public Administration in 2014) presented participants with specific challenges to solve, among them the strengthening of Slovenia’s national brand. The group’s solution lay in the personalisation of the brand, breathing life into the I feel Slovenia slogan and making it a means of communication for what each of us holds dear and is thus willing to nourish and represent with pride. Therefore, anyone can now create their own slogan to say what they feel. We feel Slovenia. We feel change. What do you feel? 


International Business Partners

The German-Slovene Chamber of Commerce and Industry – AHK Slowenien

In Germany, Slovenian suppliers have a strong reputation, which can be seen by the volume of foreign trade between Slovenia and Germany and which represented more than 20% of Slovenia’s foreign trade in the last year. We expect that in 2016 foreign trade between these two friendly states will, for the first time, be above EUR10bn and close to EUR 11bn Being the Chamber that supports the larg-

est bilateral foreign trade of Slovenia, we are proud of any Slovene company going or selling its products to Germany. Therefore, we are organising two matchmaking events between German and Slovene companies – the next one will be in mid-October in Prague where Slovene companies will once again have the opportunity to prove the good name of the brand, "Made in Slovenia", especially for spare parts in the

automotive, engine and other industries. Just because of the quality of the items produced in Slovenia, the demand rises every year. The German-Slovene Chamber of Commerce, twice a year, organises a seminar "Vstop na nemški trg", where detailed information about how to succeed in the German market is shared. The next one will be on 29 November in Maribor. 

Dear Brand Slovenia, I Feel Slovenia. At first glance this slogan conveys the soul of this little country on the sunny side of the Alps. You are lucky. Sea, Mountains, Plains, Thermal spas, ski resorts, adventure, water, woods… one could go on and on. Remembering the presentation and the EXPO pavilion, people with I FEEL stickers smiling.

Clever and unique, grounded yet warm, natural, relaxing and fun. We ourselves organised an event on the subject of "Branding and Tourism Marketing". Inviting professionals from Austria and Slovenia… Tourism boards, the communications ministry, regional agencies, spas… all tasked

Advantage Austria with promoting and developing the Slovenian brand. Through best-practice cases from Austria we wanted to inspire and give new ideas. We were surprised. So much talent behind this brand. One weakness though is the disconnect at the local level and the national master plan. A problem with a simple solution. Sit together more often and just exchange ideas. I still remember a critical thought, from a Columbian assistant of an Austrian tourism company. "You have so much heart and you feel love, so why is the logo so angular?" That is the contrast here. Slovenia, at its heart, is not just "love and feel", it is also rational and European. A good place for good business. Your friends at Advantage Austria Ljubljana 

Autumn Edition 2016 | The Slovenian Times

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International Business Partners Economy

Luxembourg-Slovenian Business Club (LSBC) Some say the most important task for all US presidents is promoting the US Brand - wherever they can and as well as they can. They paint a picture of the USA as the most progressive and successful country where top results in business, research, art, sport etc. can be achieved and everybody can develop their potential and achieve anything through hard work and talent. Brand awareness should be a key mission for both Slovenian political and business leaders, together. In today’s world, it is about building visibility and trust. Brand Slovenia should be recognisable as a hub for various high value-add industries for the whole region, for the superb R & D potential, progressive thinking/ideas, East-West connectivity, the fantastic nature and cultural diversity. If we want Slovenia to become one of the most progressive and successful countries in the world and a country of choice for living for the most creative and successful people, then we need to articulate this vision accordingly and promote the brand wherever we can. We are all in the same boat. 

Italian Trade Agency (ICE)

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Green, active, healthy: these are the immediate associations occurring when we think about "Brand Slovenia". It is true that a country’s brand is a significant tool in all sectors and even more so in our globally competitive era. However, credibility is everything and the impression is that Slovenia’s official brand definitively hits the target. In this framework, our activities as well as relevant Italian investments are linked with green technology in several sectors: from wood processing and design to textiles, from food to health, including machinery, energy and engineering. You have a huge reserve of biodiversity, more than half of the Slovenian territory is covered by forests, more than a third is included in the European network of Natura 2000 with 28,000km of rivers and streams without considering the lakes and thermal springs. It came as no surprise that Ljubljana became the 2016 Green Capital of Europe and Slovenia was ranked fifth among 180 countries in the Environmental Performance Index. You are consistent in protecting this heritage and promoting it. This consistency is rewarded by economic operators who appreciate this potential, along with a highly skilled workforce and a favourable geographic position. Strategically located at the centre of a strong knowledge network, you have already developed prominent partnerships with neighbouring countries and more will come. In our case, the contiguity and the presence of an Italian speaking minority are potential sources of further interest. 


International Business Partners Slovenia’s Brand in Russia: More pain to gain Slovenia and Russia are two brotherly nations but, due to the plummeting ruble, Slovenia has faced a serious drain of Russian tourists to other locations, roughly 20 percent annually. Out of 43,000 Russian tourists who visited the country in 2015, most were attracted by Slovene thermal resorts. This proves that promoting Slovenia as a rare green spot in Europe for health improvement is the right brand trigger. However, many of the basics must still be done: • make Slovenia more accessible to Russians by "killing" Adria’s monopoly on direct flights - look at the case of Budapest’s Wizz Air’s or Bratislava becoming a hub for low-cost Pobeda! • improve Slovenia’s awareness, via TV and internet channels (Waterfull Slovenia or I Feel Slovenia are almost unheard of in Russia)

Yury Praslov, Slovene-Russian Business Club in Moscow; Photo: Victor Kibus

• integrate Slovenia’s green and healthy value proposition in the key niches of the value-add medical and tourist markets.

Slovene - Russian Business Club The Slovene-Russian Business Club has tried to promote Slovene thermal resorts through roundtables in Moscow but, with no support from the Slovene side, not much more can be done. Broadly speaking, all the cultural initiatives are also working to promote awareness of Slovenia in Russia. Several projects of Manca Izmajlova were supported by the club but with no sizeable financial support from the Slovenian side, this bright talent has little chance to compete in music festivals in Russia. A simple illustration of somewhat lost opportunities… 

Your Daily Source of Information www.sloveniatimes.com Autumn Edition 2016 | The Slovenian Times

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Brand Slovenia Slovenian paradox:

Alpine over-achiever held back by under-achieving tendencies Prepared by Joji Sakurai

Any Madison Avenue advertising executive handed the brief of creating "Brand Slovenia" would probably not believe her luck. The question wouldn’t be how can I build a promotional campaign around this country but rather, where do I start?

Joji Sakurai, a veteran AP foreign correspondent editor

Would it be the astonishing natural beauty of a country where you can take a dip in the Adriatic in the morning and hit Alpine slopes after lunch? Or perhaps the environmental abundance where the waters are among the world’s cleanest and brown bears roam free in one of Europe’s most forested lands? Would she highlight the hardworking, highly-skilled workforce that gives multinationals confidence that Slovenia is a place where they can produce top-quality goods? Perhaps the way to sell Slovenia, she might think, is to focus on how infrastructure combines with innovation to give Slovenia an enviable position in the heart of Europe.

It’s not hard to build a strong brand for Slovenia and so it’s all the more surprising that Slovenia has not been able to create one. This is one of the many puzzling features of a country that for a newcomer makes Slovenia seem a land of paradoxes and contradictions, not the least of which is how a society so geared toward quality of life ranks near the bottom in the "subjective well-being" category of the OECD Better Life Index (while outperforming in environment, safety, education, housing and lifework balance.) There should be no doubt that Slovenia is a successful country. Many Slovenes may disagree but by any objective measure Slovenia is a society that works. The real question – and here branding can play a role – is why Slovenia is not performing better. Compared to its Balkan neighbours and most of CEE, Slovenia is an overachiever. But several chronic factors – from government corruption to excess state intervention and the population’s tendency to be hard on itself – conspire to make Slovenia an under-achieving success story. Turning the question on its head it is tempting to ask - given the entrenched problems, how is it possible that the country is doing so well? All of this comes into focus by examining Slovenia’s position in the global competitiveness rankings issued by the World Economic Forum. Slovenia jumped from 70 to 59 (out of 140) in the 2015-2016 report – strong progress

It’s not hard to build a strong brand for Slovenia and so it’s all the more surprising that Slovenia has not been able to create one. 52

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– but still ranks below Rwanda and Azerbaijan. At the same time, Slovenia is the only country in the former Yugoslavia and one of the few in the former communist/socialist sphere, classed as an "advanced economy" as opposed to "emerging Europe". For all of the things Slovenia is doing right (it ranks 15th in health and primary education and 22nd in higher education and training), there are as many categories in the WEF report where it does poorly. It comes 89th in macroeconomic environment, due largely to debt overhang from its 2013 banking crisis but also, according to the IMF, to excessive state interference and weak corporate governance which has led to inefficient asset allocation. And both foreign and domestic investors will give pause when considering that Slovenia places 95th in labour market efficiency. Perhaps, most damagingly, Slovenia ranks 67th in the strength of its institutions, a measure of legal and administrative frameworks. The situation is made even more bleak by the fact that the rule of law in general society is outstanding. So it is corruption, waste, cronyism and other factors – among government and bureaucratic cadres – that almost solely accounts for the negative score.

Slovenia already has one export that deserves to be a global champion - tourism. Slovenia is simply one of the most beautiful countries in the world but it struggles to turn itself into a leading destination because of the failure to brand itself. 01


Brand Slovenia The picture that emerges is of a country with a high standard of living and an energetic workforce but one that is not yet a good place to do business. It is a country where bureaucratic red-tape, economic protectionism and collusion among the government and corporate elite represent the greatest obstacles to success, in particular attracting foreign investment. Put simply, if you are an executive of a multinational looking to build a new plant in Central Europe, Slovenia is a great place to visit – perhaps for a business lunch on the shores of Lake Bled – but you may not want to live here. Along with institutional reform, Slovenia can also achieve its potential (topping the big leagues of small countries) by fostering the right strategies for success and packaging them in a coherent brand so the world takes notice. The best approach for a country of two million people is to maintain a sharp focus and play to their strengths. First, Slovenia can be a premium boutique tourism destination and an innovator in green technologies. As Andrew Page, the former British Ambassador to Slovenia, told me recently over dinner in London: "If there’s one thing that all Slovenes can agree on it is love of the environment." Slovenia may want to think about making this both the brand and the product. Slovenia can export its world-class expertise in sustainability, for example, by packaging technologies that build upon its greatness in clean water systems. The important thing to remember for a country as small as Slovenia is that it should aspire to be a global leader in one core sector or two or three core products. Currently, Slovenia appears to have things the other way around – it ranks generally high in innovation but does not have a single global household-name product. Slovenia can perhaps learn lessons in the way Finland established a

Slovenia jumped from 70 to 59 (out of 140) in the 2015-2016 report – strong progress – but still ranks below Rwanda and Azerbaijan. 03

global footprint with Nokia and Estonia gained international fame by becoming E-stonia. Perhaps Slovenia’s solution is to develop a worldclass electric car; or a breakthrough in wind or solar power; or new technologies in recycling, water purification or protecting woodlands. All of these fields are becoming more important globally due to climate change – and all play to Slovenia’s strengths and preoccupations. To succeed, Slovenia may need to do more to build upon its excellent education system, establishing better vocational training so that specialists – German-style meisters – develop a bedrock of deep knowledge for the creation of new things. Slovenia already has one export that deserves to be a global champion - tourism. Slovenia is simply one of the most beautiful countries in the world but it struggles to turn itself into a leading destination because of the failure to brand itself. I was told recently that Macedonia, which can boast of far fewer attractions, has produced several CNN promotional campaigns - Slovenia only one. Many of the ideas in this article are also in the government blueprint "Slovenia’s Smart Specialisation Strategy" – or S4. The key is to move them from paper to reality. And in order to execute effectively there should be greater willingness to give the private sector a freehand and managerial responsibility. One sentence in S4 should give pause: The state (the document itself puts "state" in bold letters) is responsible 02

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for S4 management, namely S4 preparation, supplementations, implementation, monitoring and evaluation. In the global context, Slovenia is most definitely a success story and Slovenia can and should be proud of this. These proposals are intended to identify ways in which Slovenia might fulfil its potential as one of the hottest niche performers in Europe. It goes without saying that Slovenia will never rival Germany or the UK and that Serbia will eventually overtake Slovenia in economic might simply by virtue of the size of its market. That is not really relevant. Slovenia has only two million people and the challenge ahead is to make them among the richest and happiest two million people in the world. With greater economic openness, robust institutional reform, strong branding strategies and last but not least, a burja of confidence and optimism, the goal can be achieved! 

Slovenia has only two million people and the challenge ahead is to make them among the richest and happiest two million people in the world. With greater economic openness, robust institutional reform, strong branding strategies and last but not least, a burja of confidence and optimism, the goal can be achieved! PHOTOS 01 Krnsko Lake 02 New Triglav National Park centre in Bohinj. Photo: Tinkara Zupan/ST 03 Rogla at Rogla mauntain. Photo: Tamino Petelinšek/STA 04 Ljubljana Old Town

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Brand Slovenia Business and education culture

Slovenia has more to offer than its population thinks Prepared by Jenny Tumas

Slovenian higher education has taken the world by storm in Michael Moore’s latest film, Where to Invade Next. The film shines the spotlight on the fact that, in Slovenia, all higher education is free, while at the same time acknowledging that a robust welfare state is never held on to without a fight. In terms of educational attainment, Slovenia performs well in comparison to the OECD and the European Union. More than 29 percent of the population has some tertiary education but, despite these statistics, it is well acknowledged that the country faces an increasing brain drain, high drop-out rates, underfunding of education and a lack of openness. In order to be a place where the best and the brightest minds come to study, work and live, reforms must focus on what it really means to value students and young professionals. Raising salaries is often-touted as a way that companies can attract and keep a talented workforce. There are, however, other effective workplace satisfaction reforms that can have a similar effect. Work is not just a necessity to pay the rent and bills; it should be a place of personal and professional growth. Young

workers need to be challenged to do better and appreciated for the value they bring to their companies. As such, too many companies in Slovenia have an outdated view on the employer-employee relationship. Young Slovenian workers emphasise that the current corporate culture is one in which employers think they hold all the cards, as if companies are 'entitled' to their employees. Not only does this leech ambition which is ultimately harmful to the company, but it also pushes the brightest minds and best workers abroad. Many Ameri-

Too many companies in Slovenia have an outdated view on the employer-employee relationship.

"I am now more convinced that I want to return to Slovenia than when I left for my Master’s degree. But I want to come back to a work environment that is interesting and research-driven." Jernej Fink, Mislinja, Slovenia Masters in Computational Science and Engineering, ETH Zurich Bachelors in Electrical Engineering, University of Ljubljana

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Slovenian companies often copy and transplant existing practices from abroad when they attempt to make improvements. can companies, particularly those leading the workplace revolution from Silicon Valley, seem to have figured out the give-and-take relationship that should drive the employee-employer bond. The relationship can start with internal company reforms: investing in employee training programs; more flexible hours; measuring and evaluating success based on output not hours worked; giving employees the freedom to test novel ideas; and creating avenues for promotion. Slovenian companies often copy and transplant existing practices from abroad when they attempt to make improvements in workplace culture with the result that employer and employee attitudes don’t match the new policies and real reform never happens. Teo Radetić, an ambitious, young data analyst and researcher with degrees from the Oxford University and the University of Ljubljana, brings nuance to the conversation: "it should be about creating our own corporate culture that resonates with employees and works for employers. This comes from listening to your employees about what needs to be better in the workplace." Even though Slovenian corporate culture has made significant strides in recent years, according to the IMD Competitiveness Rankings, it still lacks openness to new ideas and flexibility. On the ground, job seeking foreigners and Slovenians who have studied abroad notice that many of their potential employers view

"There is too little appreciation for the humanities in Slovenia. Abroad, the idea is different. Companies invest in training humanities graduates in practical job skills because they can take these skills to the next level. Slovenian companies are missing out on significant potential by not valuing humanities education in the same way." Teo Radetić, Ljubljana, Slovenia Bachelors and Masters in Experimental Psychology, Oxford University Bachelors in Philosophy and Bachelors in Sociology, University of Ljubljana


Brand Slovenia their foreign education as some kind of threat. Radetić explains, "When I was looking for jobs in Slovenia, there were times when I almost felt like my degree from Oxford was frowned upon, as if people thought I was boasting by just having Oxford on my CV." For a country with only a few prominent universities, it makes sense that employers would be more comfortable hiring staff from programs they are familiar with. But reducing this insularity will help companies grow and improve, and will make Slovenia a more cosmopolitan place to live and work. For many of these changes to happen, parallel shifts need to be made in higher education. The old model of education fails both students and companies. On the one hand, the system creates false expectations for students. The narrative goes something like: I graduated, so why am I still unemployed? On the other hand, companies employ hiring practices that are too focused on whether jobseekers can tick the right boxes and not enough on a person’s critical thinking skills, resourcefulness and work ethic. Jernej Fink, a computational science and engineering student currently studying at ETH Zurich, puts it well: "Industries are changing so quickly that what you learned in school will never be sufficient. The higher education system needs to focus on the kind of knowledge that has an ability to transcend the material in front of you." The educational model needs to recognise that the material taught in school is rarely going to be transplanted straight from the classroom into the workplace. The system needs to focus

The best way to prepare young people for the workforce is to recognise how rapidly industry is changing.

The system creates false expectations for students. The narrative goes something like: I graduated, so why am I still unemployed? on fostering innovative thinking and teaching students to become independent learners. As the system operates now, many students finish four years of university without ever having to read an original, academic paper. When these students become employees, how will they keep up with innovation in their field if they have never been taught, firstly, the importance of novel ideas and secondly, how to access information about these innovations? The best way to prepare young people for the workforce is to recognise how rapidly industry is changing. Furthermore, the existing educational model is not doing its job to keep bright foreign students in Slovenia once they graduate. The interviewed students mentioned scholarships, late application deadlines and low-tuition fees as reasons for coming to Ljubljana and very little about the quality of the institution. Though many looked favorably on their degree programs once they finished, their overall perception of the quality of the university was unaffected. Reforms such as reducing the number of times students can take and fail exams and continuing to push policies that reform the student status so it is not just a luxury for students who do not intend to graduate, can elevate the level of engagement and learning in the classroom. Not taking these kinds of reforms seriously will result in further loss of young talent and potential, both foreign and Slovenian. Nearly every foreigner that lives here will note that Slovenia has a lot more to offer than its population thinks. Many young Slovenians

"Slovenia was preferable to live as a student because of its size, peace and economic conditions." Sebnem Cigri, Istanbul, Turkey Masters at the Faculty of Social Sciences, University of Ljubljana

who have studied abroad have expressed a similar sentiment - they did not realise how good things were at home until they left. For all the improvements Slovenia needs to make in educational and corporate culture, these improvements should not come at the cost of all the things that make Slovenia a great place to live. Part of the "Slovenian brand" is an understanding that work should not be the largest part of a person’s life. As evidence, fewer Slovenians work long hours (50 hours or more per week) compared to the OECD average. This work-life balance gives people time and energy to spend in their communities, building relationships that ultimately create a well-run, cohesive, and friendly society. It is the quality of life factors – a society that values strong social networks, the ease to get involved in issue advocacy to make an impact, a clean environment and healthy people – that brings Slovenians back home and sees foreigners fall in love with their lives here. While the country certainly has a lot of work to do to transform its education and business sectors to meet the demands of its brightest inhabitants, the identity of a Slovene extends well beyond jobs and degrees. 

"Slovenian brand" is an understanding that work should not be the largest part of a person’s life.

"I come from a non-EU country and that is reason enough to explain why I did not stay in Slovenia. It is much more difficult for a non-EU citizen to remain and work (or study) in Slovenia." Darko Milogorić, Belgrade, Serbia Bachelors in International Relations, University of Belgrade Masters at the Faculty of Social Sciences, University of Ljubljana

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Experience&Lifestyle Slovenia Art is something which not only feels good but creates excitement and a certain level of awareness with which the representative of the classical music should be able to address the social problems of today directly and powerfully!

Miha Pogačnik

Interview: Miha Pogačnik

The Artist is the one who is able to mirror the truth; with or without permission… Prepared by: Tina Drolc, M.Sc.

Miha Pogačnik, a leadership resonance expert, violinist, Slovenian Cultural Ambassador and a professor at the IEDC – Bled School of Management, is also an exceptional virtuoso in the corporate and the political world. Through music and art, he demonstrates the principles of renewal and change, transforming thinking patterns and removing barriers which limit creativity and vision. He creates an inspirational platform for tackling teamwork and effective communications for more than 150 companies worldwide. Having lived 19 years in the US and 26 years in Hamburg and Mexico, he also initiated over 200 intercultural IDRIART festivals and conferences in crisis areas of the world: among them Budapest, Tbilisi, Ulan Baatar, Tibet, Dubrovnik, Amazonia, and South Africa before the fall of the Berlin Wall. 56

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Q "An artist who must create far from home actually becomes a student of life-changing school for cosmopolitanism", you have said. What has carved you into a visionary leadership expert from an artist and initially traditional concert violinist? A In the early 1980s, I realised as a concert violinist that something essential was not possible within the world changing so dramatically. However, the concerts were still the same as few centuries before and only intended for those who love classical music. On the contrary, I always claimed that art is something which not only feels good but creates excitement and a certain level of awareness with which the representative of the classical music should be able to address the social problems of today directly and powerfully! So, 35 years ago, I established a unique festival in France, Chartres. While I have played many concerts at different places before it just happened that in the cathedral when I started playing I realised the cathedral was saying, "Play on me, not just on your violin!". From that time on, I really tried to extend every tone into every corner of this cathedral, to stop playing micro violin and start with macro violin. With this concept, I try to explain to big companies how to lead out of the periphery, like in the cathedral – play out of every corner of that huge space and make sure that when the music comes back, the echo does not interfere but rather you establish sensitive relationship with the periphety. At that time I was a very good networker in the traditional sense and I managed to establish this Chartres Festival the following year, with 1,200 people from 40 countries who came for one week. And this festival was really a step to a new phase of my life. I invited many artists from all over Europe to come and through music and arts, presented the polyphonic identity of Europe while deadly Pershing missiles were placed on german soil in 1983 . Then I decided to move Chartres festival to Bled and imagine, at that time, 800 people from outside Slovenia came! Suddenly a violinist brought many important people to Slovenia, from then on the social innovation emerged: Audiences following art-


Experience&Lifestyle Slovenia ists to the places to the crisis areas around the world, because I knew that where there is crises, there are also opportunities. From there on a 20 years period started for me , more than 200 festivals which I extended from Slovenia to Budapest, Prague and all continents -Latin America, New Zealand, Mongolia, India, the Amazon, Tibet, etc. At one point I was running 16 non-profit organisations around the world.

Q How do you approach the challenges, conflicts and crisis of today? A I have never stopped being a violinist which is my core activity, but I do not get stuck with it and I have found innovating way of implementing it. My own perception of the art has shifted from the 80s. I would not now be doing intercultural festivals in a crisis area because I know more about the causes and I know that today we have economic wars and so I decided to go to the root of the cause. We need to change the inner economic system and then we will have a different life. In Swedish, the word for economy is näringslivet, which means food for life. Now tell me, "Is the economy of our time food for life?" If we live in a world where the economy is the God of everything, then I think it is necessary

music masterpiece can create a proper resonant space for them to be able to rethink the solution. I show them how the music also involves crisis and solution therefore they make a connection, suddenly they hear with their "corporate ears" what I play and paint. I first take them very quickly through the musical process, which has archetypal character, up and down moments. If you learn to master a real problem, you create a second curve in your life. Secondly, after their interdisciplinary experience of musical journey I put them into small teams where they become artists as a team! Given that they have the opportunity to be creative, all kinds of things happen… and everybody is learning through the artistic approach, which is not dangerous. Because, in art, you can make mistakes, you are not in the numbers and pressures of the company. They transfer channel all their corporate problems through the art; often also laugh about themselves and have fun! After this, they become great listeners, because nowadays we lost this capability due to the increased electronic environment. Intuits can identify 55 sorts of snow and the population around Pacific can identify over 150 shades of blue on the ocean

In Swedish, the word for economy is näringslivet, which means food for life. Now tell me, "Is the economy of our time food for life? to add a bit of the arts into the centre of the economic thinking, as creative artist to be a part of these economic activities, to reach and transform the core of Homo Economicus. Nevertheless, we are not there. We are in the concert hall with the wives of those CEO’s who send them to the concert! I always say an artist should be an entrepreneur and should discover where his/her place is and fight for it! An artist draws on the tradition of the court jester - funny - but the one who is able to mirror the truth to the emperor; with or without permission…

Q You work with many global names such as the World Economic Forum, the World Health Organisation, the World Bank, Airbus, Emirates, Coca Cola, Mercedes-Benz, Microsoft, Novartis, Pfizer, Shell, Porsche and many others. How does your music based approach attract them? A I play strictly classical masterpieces and I know which music element helps to create an environment where leaders suddenly reconsider their ways of operation. First, I get a very precise briefing on the current condition of the organization because if you want to bond with your client you do not only show them a PowerPoint presentation, you give them something creative. I need to know everything about the company and their challenges to know which

What is missing in today’s life is meaning and music helps a lot here! When a human finds the meaning, he/she can operate at many levels.

Q "When looking at Slovenia from abroad, I can see that Slovenes have very quickly substituted quality of life with 'corporation' luck of distant masters", you once wrote. It seems we have a challenge… A I always keep saying in the Adriatic region, not to always do what they tell you in the west, do not forget your identity. Try to discover what you have and what your valuable contribution is to this world because in the west true inspiration has in many ways dried out. There is a lot of infrastructure but some gentle human principals are missing. Companies are full of fear. I am saying to my people in Central Eastern Europe: bring out the unique quality you have. When making deals in the west first you call all the lawyers, then you sign and then you go to dinner where everyone pays for themselves. But in the east it is all the other way around: first you make a relationship and celebrate then you need no lawyers, just a hand shake!! I go for that, there is nothing higher then trust, it is deeply human. 

surface! Who can today be so sensitive? And what is missing in today’s life is meaning and music helps a lot here! A masterpiece radiates meaning in highest potency! When a human finds the meaning, he/she can operate at many levels. We have so many people these days walking around shopping malls and you can see that they are lack of meaning.

Q We already find, even in the largest compa-

Miha Pogačnik and Ban Ki-moon Secretary-General of the United Nations

nies, their "Chief Inspiration Officer". What does this job position stand for? A If you do not have inspiration in an organisation, then you have a situation when people say "our company is just ok" and people have jobs where they feel they just have to do it, feeling OK but not really motivated. You have good managers who know how to work together but they "play the wrong music" which does not inspire them. But what you really need to do is to go far beyond your product, how do you relate to people, what are deep effects of your products… you have to look at the activities from a different angle. That is why a Chief Inspiration Officer needs to stand together at the top of the company and give it the character, the peripheral strategy as playing in the Chartres cathedral. That is already happening and will happen more and more in the future. Autumn Edition 2016 | The Slovenian Times

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Interview: Dr Taleb D. Rifai, Secretary-General of the UNWTO

The new tourism strategy will definitely make Slovenia a five star destination Prepared by Tina Drolc, M.Sc.

While Dr Taleb D. Rifai, Secretary-General of the United Nations’ World Tourism Organization (UNWTO) based in Madrid visited Slovenia at the occasion of his address at Bled Strategic Forum, he revealed for The Slovenia Times his confidence about the Slovenian new tourism strategy. Additionally he pointed out that the country Slovenia improve its tourism records because of hard work, not because some other locations are temporarily affected by crises of different nature. Moreover, Dr Taleb emphasizes, that tourism can have a transformative power to foster peace and reconciliation.

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Q Recently you have said, "Travel is a language of peace". Additionally you highlight the role of tourism as a catalyst for development and a source of wealth. Unfortunately the global travel and tourism safety are nowadays connected. How does UNWTO contribute to open up the places to tourism after they are attacked? A Traveling opens our mind and increases our interest about other cultures, thus human values such as solidarity and understanding, something highly needed in current societies. Tourism has shown to be a great tool for intercultural dialogue but also an excellent catalyst to induce the recovery. For UNWTO the best manner to support those nations is to continue visiting them, facilitating their recovery. Last year we held the UNWTO General Assembly in Medellin, Colombia, in order to showcase how tourism can have a transformative power and this year we held a Conference in Sri Lanka on the potential of tourism to foster peace and reconciliation. These are only two examples of different manners to support countries that have prioritize tourism as a strategy to further develop but also successful cases of nations that have become wonderful and unique destinations. Q Do you think the perception of insecurity that has followed by the attacks (especially Egypt, Tunisia, and Turkey) contributed to the tourism records in Slovenia and Croatia this summer? A Unfortunately, the perception of safety and security is related in many cases with lack of information and prejudices. Because of that UNWTO always recommend countries to disseminate accurate and objective information when crises of different type occur.

Tourism has shown to be a great tool for intercultural dialogue but also an excellent catalyst to induce the recovery. There are many misconceptions about the tourism sector and one of them is to justify growth in a certain destination by the decline in others. This is neither fair nor precise. Our experience shows that the gains registered in some destinations do not numerically correspond to the losses in others. Even if this would be the case, the gain would be only temporary because tourism is a highly resilient sector that can recover from crises in a surprisingly fast manner. If Slovenia and Croatia are improving their tourism records is because they have been working hard in the last years and because they have become great destinations, not because some other locations are temporarily affected by crises of different nature.


Experience&Lifestyle Slovenia Slovenia needs to continue its active promotional campaign to increase inbound tourism volume as well as to diversity its tourism offer and increase conncetivity.

Q How do you see Slovenia tourism, what are its opportunities and the challenges on the other hand? A With a rich cultural and natural heritage, Slovenia offers a variety of tourism products that converts the country in a unique and authentic destination. It is important to highlight the efforts to position Slovenia as a green and sustainable tourism destination. The national brand "I feel Slovenia" communicates that Slovenia is a green destination and tourists can live a unique travel experience in the country. Slovenia needs to continue its active promotional campaign to increase inbound tourism volume as well as to diversity its tourism offer and increase conncetivity. It is of utmost important that the Government of the country considers tourism as a driver of socio-economic development and job creation. The new tourism strategy that will be launched in the coming months will definitely make Slovenia a five star destination by 2021 focusing on green, active and healthy experience.

it is true that there are innovative strategies such as diversification of the offer, promotion of unknown sub-destinations that help manage the increasing number of tourist arrivals.

Q This year 60th UNWTO Commission for the Americas was held in Cuba, Havana. What are the UNWTO activities in Cuba? A Cuba has been for long a leading tourism destination in the region and this historic moment we live will contribute to further advance tourism in Cuba. Cuba is a UNWTO Member State since 1975 and UNWTO has been since working with the country in areas such a planning, human resources or marketing.

Q How does digital revolution affect tourism industry for both, tourists as well as for tourism services providers? A ICTs and new technologies have influenced, are inspiring and will lead the development of the tourism sector in the future. The impact is of tremendous nature and involves all stakeholders involved, from public authorities to the varied segments of private identity, such as the hospitality services, transportation and tour operators. Access to information, service provision and facilitation of seamless travel are only some of the benefits that ICTs offer to the tourism sector. The possibilities are as wide as the different solutions opened by this amazing environment. 

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Q Is it important that Slovenia connect at the regional level in the field of its touristic offer and where do you think is this essential? A Regional tourism can contribute to the growth of inbound tourism volume in Slovenia, as together with its neighboring countries, it can offer regional tourism products, like cultural and gastronomic routes and sport activities among others to attract visitors from long-haul destination. Q For the fourth consecutive year, international tourism grew faster than world merchandise trade, raising tourism’s share in world’s exports to 7% in 2015. The total export value from international tourism amounted to US$ 1.4 trillion. Is continuous growth positive, or does it has a limit? A 2015 has been the 6th consecutive year of growth of the tourism sector after the financial crisis and probably 2016 will be the 7th. When a sector performs in an appropriate manner, the natural trend is to grow. In the case of tourism,

It is important to highlight the efforts to position Slovenia as a green and sustainable tourism destination.

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Our experience shows that the gains registered in some destinations do not numerically correspond to the losses in others.

PHOTOS 01 Dr Taleb D. Rifai's address at Bled Strategic Forum; Photo: Stanko Gruden/STA 02 Dr Taleb D. Rifai and Borut Pahor, President of the Republic of Slovenia at meeting in Vila Zlatorog, Bled; Photo: Daniel Novakovič/STA 03 Dr Taleb D. Rifai's address at Bled Strategic Forum; Photo: Stanko Gruden/STA

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Experience&Lifestyle Slovenia

Ljubljana: Past and Present

Over the past decade, Ljubljana has undergone important changes that have completely transformed the image of the city, increased the quality of life for citizens and aroused the interest of domestic and foreign visitors. The Municipality of Ljubljana team and Mayor Zoran Janković have, in the meantime, implemented more than 1,700 projects that have taken Ljubljana on to the path of sustainable development, where daily urban life involves care for the environment and future generations. A clear vision and its results recently brought the city the prestigious title of European Green Capital 2016, the highest award for sustainable development for European cities. PHOTOS: Dunja Wedam, Nik Rovan, Miha Fras, Doris Kodrić, Barbara Jakše Jeršič, Domen Pal, CBE d. o. o. Archive, MOL Archive

BEFORE

Ljubljana Slovenska Street

»2015

REDEVELOPMENT

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NOW


Experience&Lifestyle Slovenia BEFORE

NOW

Ljubljana Šmartinska Park

»2009

RENOVATION

Ljubljana Prešeren Square & Triple Bridge

»2007

RENOVATION

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Experience&Lifestyle Slovenia BEFORE

Ljubljana Congress Square

»2011

REDEVELOPMENT

Ljubljana

Sava Recreational and Educational Centre

»2012 REGENERATION

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Experience&Lifestyle Slovenia BEFORE

NOW

Ljubljana Hladnik Footbridge & Špica Park

»2009 »2011 FOOTBRIDGE CONSTRUCTED

PARK RENOVATED

Ljubljana Swimming Pool Kolezija

»2015

REDEVELOPMENT

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Experience&Lifestyle Slovenia

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Fairy tale in Postojna cave A stone's throw from Ljubljana, Slovenia's capital, a visitor can enter a whole new world, the world-famous Postojna cave. The home of baby dragons, the cave is considered unique for its baroque appearance.

Baby dragons in Postojna cave In January 2016, a fairy tale became reality: the news that the eggs of dragon's offspring had been laid spread around the world. On Saturday 30 January 2016, one of the Postojna Cave guides noticed that there was an olm egg attached to the glass wall of the aquarium in the Postojna Cave's Concert Hall. Next to the egg, there was a pregnant female olm guarding the egg, an event that is rarely observed in the natural environment. The animal ended up laying 64 eggs, of which 23 were designated as viable. The likelihood of a successful hatching was seen as very small: in nature it is estimated that only one in 250 eggs hatch. Biologists took special precautions to protect the eggs. They removed all but the parent olm from the aquarium and shaded the tank to recreate cave-like conditions. Four months of waiting paid off when an egg of a rare cave olm hatched in the world famous Postojna Cave at the beginning of June. The phenomenon is rarely witnessed by people, but this time it has been captured on infra red camera. Olms, the blind salamander popularly referred to in Slovenia as human fish but also lovingly known as Slovenian dragons, are a

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rare and mysterious species living in deep caves throughout the Balkan that are often inaccessible. The unusual looks of the olm have always sparked our imagination. At first it was believed that they were just baby dragons which the high tide brought to the surface. As a matter of fact, there might be some truth to these old beliefs. The human fish or olm (measuring 23 to 30 centimetres, the world's most famous cave animal is also the largest of all and is the only European vertebrate living exclusively underground) is a neotenic animal. In simple words, this means that an adult keeps most of its juvenile features. This means all human fish are babies that have taken on adult functions. And if we imagine that the human fish should decide to grow up… Wouldn't it perhaps really grow into a dragon? Postojna Cave is at the very height of the world's caves in terms of the richness of cave animal life. Apart from human fish, 99 other  animal species live here permanently and 150 occasionally. This includes tiny spiders, the fascinating tiny-neck beetle, the cave water louse, grasshoppers, butterflies, water snails, bats, etc. Owing to its early discoveries, Postojna is regarded as the cradle of the scientific discipline of speleobiology, which sets it apart

as an undisputed world centre. Right before the entrance to Postojna Cave, the Passage of New Signatures contains the Proteus Cave – Vivarium. Its predecessor, the Speleobiology Station, was founded in the 1930s.

Hotel Jama open for business In the spring of 2016, the completely renovated Hotel Jama**** opened for business. Its 80 twin/double rooms will provide guests with the comforts of modern accommodation facilities and a quiet environment for some relaxation. The completely refurbished Hotel Jama, which is located in the heart of the Postojna Cave Park, is a perfect choice for visitors to two world-famous tourist attractions: Postojna Cave and Predjama Castle. All of its 80 twin/ double rooms and suites with en suite bathroom facilities will offer all the necessary comfort and relaxation to both visitors who will 04


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37 millionth visitor to Postojna cave

I, who was also the first to sign the visitor book. By 1941, the number of books amounted to 31, all of which are kept at the cave museum. In 1857, a special book was introduced, the so-called Golden Book of Visitors, used only for the signatures of the most eminent visitors. At present, the fourth volume is in use, and the visitor book entries speak volumes about the past times and the global political situation. The 37 millionth visitor this year was Slovenian Zinka Kolenc from Črnuče who took her grandsons to Postojna cave.

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stop in Postojna for one night only and those who will decide to spend here a longer part of their holiday. The use of the parking lot is available to guests free of charge. The hotel’s location next to the worldfamous heritage site, yet at the same time in the midst of nature’s peace and tranquillity, provides a perfect opportunity for a number of walks in the unspoilt surrounding area and also makes for an excellent starting point for day trips to Ljubljana, Bled, the Slovenian coast, Trieste, and even Venice.

Throughout its 200-year history as a show cave, Postojna Cave has been visited by over 37 million enthralled visitors from all over the world, many of whom have left their signatures and comments in memory-filled visitor books. One of Postojna Cave's notable features are without doubt the entries found in visitor books, especially in the so-called Golden Book of Visitors, which features numerous interesting names from the world's history, culture, science, politics, economy etc. Even back in the mid-19th century, Postojna Cave boasted numerous visitors not only from Europe, but also from Australia, China, India, and even Java and Sumatra. Back in the day, visitors would sign their names directly onto the cave walls and even speleothems. Thus, the Passage of Old Signatures features signatures dating as far back as the 13th century, with most of them being from the 16th and 17th centuries. The first 'official' visitor to the cave, which was at the time already set up as a show cave, was the Austrian heir to the throne, Ferdinand

Source: Postojna Cave PHOTOS: 01 The Eggs of dragon's; Photo: Alex Hyde 02 Olm, the blind salamander; Photo: Alex Hyde 03 Hatching of baby dragon; Photo: Iztok Medja 04 The Postojna Cave; Photo: Iztok Medja 05 Hotel Jama – room; Photo: Miran Kambič 06 Hotel Jama – restaurant; Photo: Iztok Medja 07 Hotel Jama – conference room; Photo: Iztok Medja 08 Renovated Hotel Jama in the middle of Postojna Cave Park; Photo: Iztok Medja 09 The 37 millionth visitor this year was Slovenian Zinka Kolenc; Photo: Iztok Medja 10 The Postojna cave CEO, Mr. Marjan Batagelj holding a piece of the celebration cake; Photo: Iztok Medja 11 The Celebration at entrance podium; Photo: Iztok Medja

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Experience&Lifestyle Slovenia

ŠUS Eurofitness –

Best sporting offer in town Do you have little spare time and yet would like to do various sporting activities? Then Sports Centre ŠUS Eurofitness in Ljubljana is the right place for you. It offers fitness, group exercise, a spa centre with a pool, Turkish sauna, jacuzzi and more. ŠUS Eurofitness is the first Heart Friendly Sports Centre in Slovenia.

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Experience&Lifestyle Slovenia The centre is a partnership between the Catalan UBAE organisation from Barcelona and Športna Unija Slovenije. The membership based system is an all inclusive offer - every member can use all the services for the same price. Members can attend more than 300 hours of group exercise a month; group workouts range from 6am to 10pm daily. Various activities are in English, which attracts and inspires international members. Comments Gregor Pečovnik, ŠUS Eurofitness Director: "Don’t let work stress influence your body. Lead a healthy lifestyle and try to relax. ŠUS Eurofitness offers everything in one place. The Centre is the only one in Slovenia awarded a Heart Friendly Sports Centre certificate."

"Do you have a little spare time ŠUS Eurofitness also offers all inclusive and you would like to do various sport programs for kids; basics of Gymnastics, basics of Athletics, Ball games sporting activities? Then Sports centre ŠUS Eurofitness in Sport house Ilirija in Ljubljana is the right place for you. It offers all inclusive sport programs with two fitness studios, more than 350 group exercise per month, a spa centre with a swimming pool, Turkish sauna, Jacuzzi and more."

and swimming programs for all ages. Kids have a chance to try different basic sport activities and build their motoric skills. At the same time parents can work out in a fitness studio.

Contact: ŠUS Eurofitness Vodnikova cesta 155 1000 Ljubljana E-mail: sus@eurofitness.com Telephone: +386 1 518 1662 Web: www.sportnahisailirija.si Opening hours: Monday-Friday: 6 am – 10 pm Saturday-Sunday: 9 am – 9 pm Holidays: closed

Autumn Edition 2016 | The Slovenian Times

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Sport

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Olympics

To the victors at an Olympic Games goes the glory, but what about the "spoils"? Long gone are the days of gold medals living up to their name. The last Games where champions wore pure gold around their necks took place in Stockholm 104 years ago. Today, an Olympic gold medal consists of 92.5 percent silver, 6.2 percent copper and 1.3 percent gold. If its worth is measured in weight, then a gold medal from this year’s Olympics is worth about US $550.

The Slovenian flag was raised four times at the Rio Olympics.

Who wins when the athletes triumph? Prepared by Jan Bratanič

How much is Olympic success really worth - for the athlete, for you and for the country?

PHOTOS: All photos by Aleš Fevžer (www.alesfevzer.com) / OKS 01 Tina Trstenjak – gold medal in judo 02 Vasilij Žbogar – silver medal in the finn class sailing 03 Slovenia fans 04 Slovenia fans 05 Anamari Velenšek – bronze medal in judo and her trainer Marjan Fabjan 06 Peter Kauzer – silver medal in the men's K-1 slalom

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Stories sell And yet, the true value of an Olympic medal does not reside in the metal or its worth on the commodity market, but in the athlete who won it and the story they told on their way to fulfilling their goals. The aura surrounding the greatest of champions corresponds to the amount of money wealthy people are willing to pay to get their hands on their medals. It is not the piece of metal that they are buying but rather, a piece of greatness, to become a part of the story which will resonate throughout history. For instance, one of the gold medals won by Jesse Owens, an African-American athlete who humiliated Adolf Hitler and the whole of Nazi Germany in 1936 by racking up four victories against "superior Aryans" in what is today known as one of the three greatest sporting achievements ever, fetched a whopping US $1.47m. Recently, dethroned boxing champion Vladimir Klitschko auctioned off the gold medal he won in Atlanta in 1996 for US $1m and donated the proceeds to a charity that he had set up in Ukraine. Remember the "Miracle on Ice" Mark Wells, a member

It is not the piece of metal that they are buying but rather, a piece of greatness, to become a part of the story which will resonate throughout history.

of the 1980 US Olympic hockey team which beat the overwhelming favourites from the Soviet Union and who sold his gold medal for US $40,000 to finance multiple surgeries on his oft injured back – the medal was later resold for US $310,000. There are probably only a few athletes from the Rio de Janeiro Olympics who could sell their medals and match or even surpass these hefty sums. Usain Bolt is the first name that pops into mind. "I’m the greatest!" he told the world after winning his ninth sprint gold medal - he is probably right! Despite that he overshadowed most of the 11,000 athletes competing in Brazil, his feats don’t diminish the sporting achievements of other medal winners, especially those from smaller countries, like Slovenia, who might never achieve the adulation of millions or even billions, but can nevertheless have a tangible impact on the development of their sport or global recognition of their homeland.

The streak endures The Slovenian flag was raised four times at the Rio Olympics. Slovenian athletes gave their competition a run for their money in handball, athletics, swimming and cycling and truly excelled in judo, sailing and white-water kayaking, making sure that Slovenia was, once again, amongst the top seven countries by medal count per capita – four medals, one for every 515,000 Slovenians. The total medal count won in Summer Olympics since independence is now 23. Slovenia’s astonishing run of podium finishes continued for the fourth straight Summer Olympic games. If there is one common thread in the 12 year period, it is our warrior judokas who became serial medal winners under the tutelage and extremely hard training regime of Marjan Fabjan. "I’m taking on the


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world with only twenty people," he said in a recent interview - and he’s winning! First there was Urška Žolnir winning bronze in Athens 2004, then Lucija Polavder and her bronze in Beijing 2008, London four years later saw Žolnir return to her winning ways beating all opponents to take home the first gold medal for Slovenian judo. Each time one of Fabjan’s judokas donned her kimono and stepped on to the Olympic tatami, a familiar feeling swept through Slovenian spectators at home – we’re are going to witness something special. And we did - again! Tina Trstenjak, a reigning world champion, decimated her competition to win the gold medal emphatically by bringing Clarissa Agbegnenou, a former world champion herself, to submission. But Slovenians weren’t done. Anamari Velenšek won a bronze medal by chocking out her German adversary, Luise Malzahn. Achieving this on an injured knee (torn anterior and lateral ligaments) makes her achievement even more impressive and inspiring for ever more numerous young Slovenian judoists. "We proved once again that it’s possible to succeed with plenty of will, energy and self-sacrifice," were Fabjan’s words accompanying her achievement. But they also hold true for at least two male Slovenian champions who dared to reach for Olympic glory. Peter Kauzer, whose mental toughness was questioned by couch commentators after two failed attempts at winning an Olympic medal in Beijing and London, finally proved his doubters wrong, barely missing the gold which went to Brit, Justin Clark. It was Giles Scott, a man from the same nation, that proved to be too much of an obstacle for the most decorated Slovenian sailor of all time, Vasilij Žbogar (two silver and a bronze medal). However, his silver is tantamount to gold when

Although Slovenian triumphs weren’t necessarily "front page" material for most leading foreign newspapers, they sent the right message to the world.

stance, Spain in 2012. The economy of the largest nation on the Iberian Peninsula was under constant media attack, the banking system was on the brink of implosion, there was talk of the Troika, similarly then a year later in Slovenia. When the Spanish national football squad won the Euro 2012 championship, the problems almost "disappeared". Researchers at Reputation Metrics found that the share of very negative news about Spanish problems fell to just 21.1 percent and there was less than half the number of images about their footballing success. "Yes," they concluded, "sporting success plays a major role in country branding." Although Slovenian triumphs weren’t necessarily "front page" material for most leading foreign newspapers, they sent the right message to the world. But there’s a difference between getting recognised as a nation of good sportsmen and being attractive to foreign investors – Olympic medals won’t hurt, but they may not help either. 

Olympics and international sports have become more important for Britain "as an arena for national prestige and soft diplomacy."

factoring in the obscene amounts of funding British sailors get. Each of the three sailing medals won in Rio cost Britain more than EUR 30m. With a budget almost 100-times smaller, Slovenia just missed out on two medals, with Tina Mrak and Veronika Macarol losing not on the water, but at the judges table.

National pride and business Britain surpassed China as the second most successful collector of gold medals in Rio. What would have come as a huge surprise just two decades ago is now expected. Britain has poured more than EUR 420m into sports that offer the best chance of yielding medals. The result was 27 gold and 67 medals in total, a significantly richer haul than in Atlanta 1996 when British athletes won just one gold medal. Olympics and international sports have become more important for Britain "as an arena for national prestige and soft diplomacy," the sport historian, Tony Collins, said for The New York Times, "so, too, has the British government been willing to allocate more and more money to sport." Whereas there is no question that investing in athletes enables further development of different sports, it isn’t yet so clear whether it pays such dividends in other areas. Do victories of compatriots bring enough long-lasting happiness to improve productivity of the workforce – some studies show that happy employees are, on average, 12 percent more productive? Can Olympic medals strengthen the country brand and make it a more attractive for tourists or even foreign capital? Sport can no doubt have an impact on the way a country is viewed globally. Take, for in-

Can Olympic medals strengthen the country brand and make it a more attractive for tourists or even foreign capital? Sport can no doubt have an impact on the way a country is viewed globally.

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Event Guide Concert

Zucchero 8 October, Ljubljana

Festival

16th Old Vine Festival

Known as the father of Italian blues, Zucchero has spent three decades reaching audiences across Europe and the world with his sound. He draws influence from rock, soul, blues and gospel and remains one of the few famous European blues artists. He will be performing in Ljubljana as part of his Black Cat World Tour 2016, which follows the release of his latest album Black Cat. The concert begins at 8pm at Centre Stožice, and tickets can be purchased in advance on the artist’s official webpage (www. zucchero.it/eng).

2 October – 11 November, Maribor This cultural and culinary festival in the centre of Maribor is a tribute to "the Old Vine," the oldest grape vine in the world which has been growing for more than 400 years. The festival begins with its annual ceremonial grape-harvest from the vine. Each year, 35kg - 55kg of grapes are harvested from the vine and around 100 bottles of wine are filled as a result. Throughout the festival, Slovenian wine growing and production will be showcased in the Old Vine House where visitors can taste Styrian wine and get to know some of the best winemakers in the region. The festival is also a showcase for traditional food and culture. The culinary marketplace will be full of traditional Slovenian delicacies from organic cheese to fresh honey, and locals lead various tours and exhibitions celebrating the city of Maribor and the surrounding region. The festival concludes on St. Martin’s Day, the day that must officially turns to wine. Maribor boasts the largest celebration of St. Martin’s Day in Slovenia.

Sporting Event

Volkswagen 21st Ljubljana Marathon 30 October, Ljubljana The Ljubljana Marathon returns this autumn! The marathon begins in the city centre, traverses much of the city and then ends in the city’s central Kongresni trg. Last year, more than 24,000 runners participated in one of the numerous running events organised by the City of Ljubljana. The marathon always draws a crowd of spectators around the city and this annual event has become a showcase of the active and outdoorsy lifestyle of Slovenians. Anyone interested in running can register for the full marathon, half marathon or 10km recreational run. Registration closes on 30 September.

 Concert

Andrea Bocelli 19 November, Ljubljana Recognised internationally as one of the best tenors of his generation, Andrea Bocelli will be in Ljubljana as part of his tour this autumn. Admired both in the classical world and as a crossover artist, Bocelli has brought classical music to the top of international pop charts, selling more than 80 million records worldwide. His Ljubljana concert will take place at 8pm at Centre Stožice and tickets should be purchased in advance.

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Event Guide Exhibition

Ana and Teddy: Bear in Slovenia 9 September 2014 – 3 December 2016, Technical Museum of Slovenia, Borovnica

Festival

27th Ljubljana International Film Festival – Liffe 9 -20 November, Ljubljana, Maribor The Ljubljana International Film Festival (LIFFe) began in 1996 as a way to feature contemporary world film and promote emerging directors and trends in film. The festival is organised by the Film Department of the Cankarjev Dom Cultural and Congress Centre, with films also shown at Slovenian Cinematheque, Kinodvor Cinema, Kinoklub Vič, and Kolosej Maribor. The festival typically boasts more than 100 different films from Slovenian and international directors and producers and also discussions with directors and other film artists. In recent years, an increasing number of famous film personalities have visited the festival. This year’s program will be released on 18 October when tickets go on sale.

Slovenia has one of the most vital and stable populations of brown bears in Europe. Current estimates suggest there are somewhere between 500 and 700 brown bears living in Slovenia. It is one of the few countries with a growing population of bears which is crucial for reintroducing the brown bear into Italy, Austria and France where the populations are extremely diminished due to hunting and habitat destruction. Slovenes have a close relationship with the brown bear, which is a popular character in Slovenian cartoons, films, children’s books and proverbs. The Technical Museum of Slovenia’s has, for two-years, been hosting an exhibition presenting the many forms the brown bear takes in our lives and it is concluding this autumn. The exhibition aims to convey the significance and omnipotence of the bear in Slovenia – from its overbearing presence in the forest to the comfort it provides our children in the form of a plush teddy. The Technical Museum of Slovenia is open Tuesday through Friday 8am – 4pm, Saturday 9am – 6pm, and Sunday 10am – 7pm. The museum is closed on Mondays, except for groups by prior arrangement.

Festival

Sporting Event

Ljubljana Culinary Festival and Slovenian Wine Festival

BMW IBU World Cup Biathlon

25 – 26 November, Ljubljana

8 – 11 December, Pokljuka

These festivals, which are jointly held in Ljubljana, will feature the very best of Slovenian cuisine. The theme of this year’s Culinary Festival is "Taste Ljubljana," and renowned chefs will prepare traditional dishes in front of a live audience. The menu includes Slovenian classics such as Kranjska klobasa, boiled beef tongue and flying žganci (a fried chicken dish). Gourmet restaurants and culinary schools will also feature numerous traditional offers including pražen Krompir (Slovenian style potatoes), štrucklji, and barley stew. The Slovenian Wine Festival will showcase the best of Slovenian winegrowers and producers. The program includes guided wine tastings and educational lectures and workshops. Both festivals will take place at the Grand Union Hotel with the Culinary Festival open from 4pm – 8pm, and the Wine Festival from 3pm – 9pm.

Slovenia’s mountains have long been famous for hosting international skiing competitions and this autumn, Slovenia will host the World Cup Biathlon at Pokljuka, a plateau well known by biathletes and fans. The Pokljuka Sports Centre has been the venue for numerous world and European championships in the past. The organizers also offer packages that include biathlon tickets and accommodation in Bled or Bohinj. Autumn Edition 2016 | The Slovenian Times

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International platform for investors in Slovenia The FDI (Foreign Direct Investment) Summit Slovenia 2016 is an executive-level business conference devoted to the investment environment and opportunities in Slovenia. Being a business networking event, it is an outstanding opportunity to make new contacts with the leading business people in the region, top government officials, existing international investors in Slovenia and those interested in entering the Slovenian market.

www.fdi.si

“SAVE THE DATE� December 6th, 2016 Ljubljana, Slovenia

The Slovenia Times Autumn 2016  
The Slovenia Times Autumn 2016  

The leading Slovenian magazine in English

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