The Slovenia Times

What does Slovenia need to improve to be more competitive in 2016?



Franci Pliberšek, Owner and General Manager, MIK, d.o.o.

If we want to be successful, we first need to be competitive. But how can Slovene companies be competitive if they do business in quite demanding and artificially complicated conditions? Therefore, firstly we need to create a healthy and encouraging business environment, which ensures export acceleration and the inflow of foreign tourists and fresh capital. Secondly, we need to attract investors and this is possible by creating a favorable tax environment for domestic and foreign investors. I suggest capital gains tax should be lowered by 3% -5%, which could motivate foreign investors to open a company in Slovenia and create new jobs as well as profit. There is a need to create new jobs with a higher value added and encourage GDP growth. Many measures are therefore available. In my opinion another measure is to take power away from the over-lobbied labour union, which has been blocking development with their measures for 20 years and also for workers due to their empty words and self-interest, staying unprotected and destitute and the companies on the other hand, insolvent.

Julij Božič, Country Leader, IBM Slovenia

"When I look at Slovenia, I see a country of great potential and great people. True, we are a small country, but this is actually our advantage - we can adjust faster, work more productively and be more agile. I believe collaboration, innovation and highly educated people are the three main things to boost Slovenia's competitiveness. We have highly skilled experts and we need to encourage them to create disruptive innovations that will impact Slovenia and the world.

IBM supports the Government of Slovenia in building a digital economy and we have begun discussions on long-term cooperation as we believe that advanced technologies are the key to connect business, government, academia & start-ups into an intelligent and functional ecosystem that will spur Slovenia's economic growth and competitiveness. We will collaborate on strategic growth initiatives in cognitive computing, cloud, analytics and security technologies that help transform legacy operations to better compete in today's economy."

Marjan Batagelj, CEO, Postojnska jama d.d.

For Slovenia to become more competitive, first of all we need a stable tax environment. Our fiscal sustainability needs to be long-term, without varying taxes with the seasons when the government changes. Secondly, Slovenia needs a flexible labour market, which means quick dismissal and quick recruitment, this is important if our companies want to compete internationally. Thirdly, Slovenia has too much bureaucracy, public administration should be lean instead of so many regulations, laws and bureaucrats. If you have a lean state, people would be responsible and the procedures would run more quickly.

Jože Mermal, President of the Management Board and CEO, BTC d.d.

This year we established ABC accelerator which helps startups and young enterprises in developing innovative ideas into successful global business models.

In the spirit of the creation of an innovative eco-system, at the state level we can sketch these steps together with our government who is already thinking about it; only the effective implementation is necessary through significant financing from commercial banks.

With such an approach, we would reduce the number of unemployed, effectively use the knowledge of young people and direct them on a business path. In this context, it would be bad if, in 2016, conditions in terms of tax regulation and competitive positioning for economic operations would deteriorate. It would be a good to have tax relief for the most prospective teams in terms of employee social contributions from salaries and personal income tax.

Sonja Šmuc, Managing Director, The Managers' Association of Slovenia

Good economic policies are the common denominator: they are logical, easily understandable and quickly adapt to new circumstances without undermining the future of a country. Good policies are hard to find, especially in countries that resort to over-regulation when faced with new situations. Slovenia is a heavily regulated country. Reducing the regulation and red tape would make business endeavours easier and quicker and with that, the volume would automatically rise. This is the first activity that would foster competitiveness and business optimism. Second is to bring labour taxation down to normal levels. Third is flexibility of the labour market - in time, overprotection tends to hurt those that it was supposed to protect. A combination of all three measures would energise the Slovene economy for both domestic and foreign investments, new jobs and business freedom. The Slovene economy would easily be among the top 10-15 European economies in less than 10 years.

Wolfram von Ohain, CEO, BSH Hišni aparati d.o.o. Nazarje

Slovenia could become more competitive if the government would: Reduce labour cost taxation, as Slovenia is losing competitiveness compared to other countries due to the high labour costs. Possible measures to reduce labour costs are: changes in the income tax scale; introduction of a social cap (limit the maximum social contributions); and lower taxation of bonus payments to employees. Change the education system by creating a closer connection between the economy and the education system. Some steps could be an increased focus on practical training in the curriculum, increased participation by companies in the preparation of educational programs and the introduction of a dual system, which would be especially beneficial for production companies such as BSH in Nazarje. De-bureaucratise procedures especially by simplifying court procedures related to business cases and by updating the law on co-management of employees due to language.

Medeja Lončar, CEO, Siemens Slovenia

The conditions for increasing competitiveness are not just concrete measures but foremost, a change in mentality. The problem of Slovenian competitiveness is that the country is increasingly closing. Therefore, measures should be focused on opening up to global economic flows, which can be achieved mainly through appropriate tax policy. We need to identify how we want to position Slovenia to become a recognisable part of the global economy and then we need to systematically promote our competitive advantages - inwards and outwards.

As Slovenia remains a strong supplier to European and global industry and has been actively involved in the concept of Industry 4.0 (technological changes toward increasingly intensive digitisation and automatisation of production), we need to plan the role of Slovenia in the industry of the future and then take the necessary measures: adaptation of the education system, change the tax environment, incentives for research projects. In this way, we can achieve our desired position.


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