German-Slovenian Economics Day hears about challenges and ways to meet them
A staffing gap, issues related to transparency of procedures and transport infrastructure were pinpointed as Slovenia's main challenges as a business destination, as the German-Slovenian Chamber of Commerce and Industry held its annual German-Slovenian Economics Day at the IEDC Bled School of Management on 18 April.
Serving as a basis for discussion at the event, themed Slovenia as a business location - seizing opportunities, shaping the future, was a study commissioned by the chamber from the German Economic Institute in Cologne comparing Slovenia with five countries in the region based on 57 indicators.
The study has shown that Slovenia and the Czech Republic are the best business destinations in the region which also encompasses Slovakia, Hungary, Serbia and Croatia.
Slovenia placed 25th and the Czech Republic 23rd in an international comparison among 53 countries, Slovakia ranked 33rd, Hungary 34th, Croatia 45th and Serbia placed 46th.
Slovenia's assets are management and know-how, but also infrastructure and costs, while the downsides are resources and the market.
Compared to the other five rival markets in the region, Slovenia attracts a relatively low level of foreign direct investment, including from Germany.
Cornelius Bähr from the Cologne institute, who presented the study, believes there are still many opportunities to intensify cooperation, a view shared by the chamber's head Dagmar von Bohnstein.
Investments by German companies account for more than 8% of FDI in Slovenia, which makes Germany the fifth biggest investor in the country.
A report compiled based on discussions with German and Slovenian companies who are members of the chamber has shown the obstacles they face, which somewhat differ from the weaknesses exposed in the study.
The three major challenges include a shortage of skilled workers in Slovenia, both in terms of their number and quality, especially young engineering and tech experts.
The second is discriminatory application of legislation, especially in how foreign companies are treated in public procurement procedures, and the third challenge is development of transport infrastructure.
"We have proposed constructive proposals for improvement," Von Bohnstein said, adding that they would like to discuss them with Prime Minister Robert Golob, but have not had the chance yet.
Specific proposals include encouraging girls to study science, technology, engineering, and mathematics, setting up a system of further training in digitalisation, speeding up administrative procedures to approve renewables projects, and constructing filling stations for electric mobility.
Company officials discussed some of these issues with Jan Löwhagen, director of MAN Truck & Bus Slovenija, pointing to the potential to improve Slovenia's public transport and help its transition to carbon neutrality. He also emphasized the need to improve digital infrastructure.
Medeja Lončar, director of Siemens Slovenia, Croatia and Serbia, pointed to a limited pool of talent in Slovenia as a problem, which she said makes life-long learning and training very important.
Filc director Anže Manfreda noted lengthy and opaque procedures in obtaining a building permit, and Armin Messerer from Mahle highlighted the high tax wedge on experts' pay.
Commenting, Economy Ministry State Secretary Matevž Frangež said Slovenia could in fact not afford to be the best in all the categories measuring a country's attractiveness for business.
He is optimistic about improving infrastructure and air connectivity and about the energy transition, while he believes the know-how is also improving.
However, he is less optimistic about the costs to business, stressing that social needs also need to be financed, so the key question is increasing the value added.
Frangež also hopes digitalisation will bring more efficient procedures in spatial planning, but spoke against bringing into the country "high risks for our environment and natural resources. This must remain untouched."