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Slovenia Business Week no. 16: CCIS Says Economy Can't Remain Competitive Without Reform

The Chamber of Commerce and Industry of Slovenia (CCIS) has reiterated its view that Slovenia cannot remain competitive in the long term without structural changes, foremost liberalisation of the business environment

The Chamber of Commerce and Industry of Slovenia (CCIS) has reiterated its view that Slovenia cannot remain competitive in the long term without structural changes, foremost liberalisation of the business environment.

Interim CCIS president Samo Hribar Milic told a press conference on Thursday, 19 April that Slovenia's economy might be well-positioned at the moment, but the outlook for the future was less rosy without changes.

Data shows that Slovenia lags behind other countries in terms of high technology products, the creation of companies and the retention of jobs, which does not bode well for its competitiveness, Hribar Milic said.

In his opinion, Slovenia must implement structural reforms if it wishes to realise its goal of catching up with the most developed countries in the world.

The measures should include deregulation of the economy, cutting of red tape and the promotion of knowledge from research institutions to business, said Hribar Milic, who also specifically pointed to the need for more flexible labour laws.

According to him, the current labour laws bring no flexibility, while talks on the changes have not made headway because of what he claims to be the stubbornness of the trade unions.

The CCIS also presented its economic forecasts, which predict that economic growth will stand at 4.6% this year and 4.3% the next.

While growth stood at 5.2% in 2006, it did so on account of extensive growth in fixed capital formations. Expansion in this field is expected to slow down somewhat this year, which will result in slightly less intense economic growth.

Head of the CCIS economic trends department Irena Rostan explained that this year's growth was expected to beat initial estimates because of the favourable trends in the beginning of the year, including that brought on by the adoption of the euro and the warm winter.

Meanwhile, chief CCIS social talks negotiator Joze Smole said Slovenia still needed to cut red tape, as the process of establishing a company took about twice as long (around 60 days) as elsewhere in the region.

Moreover, Smole said the rigidity of labour legislation was another burning problem, as manifested by Slovenia's ranking of 146th of 175 on the World Bank's indicator of labour market rigidity.

Source: Slovenian Press Agency STA

Author: STA, Slovenian National Press Agency