Finance Minister Uroš Čufer has rejected the speculation that Slovenia might need international aid due to political crisis. The country's liquid assets will last well into next year, Čufer told. He also does not believe Slovenia will need to supplement budgets for 2014 and 2015.
He reiterated that the political crisis will also not jeopardise the ongoing privatisation process. He however refused to talk about the state-owned companies that could be slated for privatisation in the future.
The minister said additions to the list of state-owned companies intended for sale will be in the hands of his successor, adding that the drafting of the list was a political issue.
The minister moreover said that Slovenia could get around EUR 1bn by selling the first 15 companies slated for privatisation. This triggered strong criticism from the audience at the conference organised by the business daily Finance and the Ljubljana Stock Exchange.
Touching on the Bank Asset Management Company (BAMC), which has taken over non-performing loans of Slovenian banks, Čufer said it was possible to get an investor for the bad bank, which is currently 100% state-owned.
Also talking at the conference was Boštjan Vasle, the head of the government's economic think tank IMAD, who said that after years of high inflation, Slovenia's economy was now facing "deflation pressure".
If the trend of low inflation continues, the deleveraging of companies will be in jeopardy, he said. Inflation in Slovenia dropped to 0.4% in April from 0.6% the month before.
Deflation could lead to a drop in companies' turnover, which would endanger their ability to pay loans, he pointed out. In the worst case scenario, companies could start imposing pay cuts.
Vasle added that average disposable income of Slovenian companies dropped by around 10% in the past five years.
He believes that the economic crisis in Slovenia was driven by poor productivity, which is 20% lower than EU average. Slovenian companies export 70-80% of their goods, making the country dependent on exports and competition with other countries unavoidable.
Source: The Slovenia Times
