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American Chamber of Commerce – AmCham Slovenia in co-operation with the Embassy of the United States of America to the Republic of Slovenia and Spirit Slovenia – Public Agency of the Republic of Slovenia for the Promotion of Entrepreneurship, Innovation, Development, Investment and Tourism:

Date of news: 18.10.2013

Ljubljana, Slovenia, 17-18 October 2013

Pre-Conference event »Technology Bridge« – High-Tech Innovations Connecting the World – in co-operation with the 4th COBIK Conference

The international integration of know-how and high technology, from innovations to the business model, can the state with economic diplomacy facilitate the penetrating of high-tech companies in the international markets?

The pre-conference event Technology Bridge, part of which was also the 4th COBIK Conference, was held on the first day of the development and Investment conference U.S. – Slovenia Business Bridge.

In the spirit of connecting and networking high-tech expertise and innovations with business environment, potential investment opportunities and industry, which is the main goal of Centers of Excellence, prof. dr. Maja Makovec Brenčič, the Vice-Rector of the University of Ljubljana, who also moderated the event, pointed out that the Centers of Excellence already represent 2-3 percent of the inflow into the economy, i.e. on average also a greater added value in comparison with business entities in Slovenia, they create employments and offer the potential to the young, innovative individuals. »We have to not only to integrate the business note and the know-how acquired – but to open the doors together, open the doors on a global level«!

Dr. Jernej Pikalo, Minister of Education, Science and Sport of the Republic of Slovenia

»A step forward can be made only if made by all of us together – by all the involved: the state is taking an important part. The excellence centers and investing in innovation and high-tech are in today` s hard times a brave and a long-term decision«. The minister emphasized the significance of exceeding the internalization of knowledge in the direction of globalization: »The technology investment is the most profitable investment with a high added value, but only if connected with the economy and the market. It is necessary to achieve the maximum effect to necessarily link the research potential with the industry, in which the private investments are necessary. The main goal should not be researching per se, but the commercialization of innovation and concrete products in the market. The research should yield a return – it must have the added value also from the financial aspect«.

Frenk Smrekar, CEO, Jafral »Your dreams are achievable if you follow yourself«.

»With ideas and knowledge, yet with a lack of money, we stroke out in a direction to search for foreign investments, and although the time was not right, we wanted to survive merely with our work«. Smrekar pointed out that the company »finds it difficult to meet all the requirements of the public tender, which furthermore demands a lot of time and thus the company must decide whether it is worthwhile«.

Dr. Marko Jaklič, COBIK and Faculty of Economics, University of Ljubljana,

stressed out the issues of the Slovenian climate, in which many scientists and researchers are highly motivated, yet the environment itself does not motivate them. »The issue is in a lot of small things which add up: the proceeding of researchers in the entrepreneurial spirit is not being encouraged enough. Small steps can be done with a strong will and a clear purpose, not only with public funds«.

Dr. Zev Gurion, the Executive Director, Aron BioMedical corridor, Akron, Ohio

»Go into action. There is enough of certainty. There is nothing wrong if you fail sometimes«.

»Someone, who understands why the world stands on innovation«, as quoted by Maja Makovec Brenčič, is certain that it is necessary that the innovation has to be taken from the local environment and made into a global one, by which the ultimate goal is commercialization – the company has to profit.

»The growth is only possible with new technologies, as they create innovation, attract new talents, capable people, increase the export,… Slovenia has a highly educated workforce, a strong base of high tech, a financial structure that enables the investment culture, which requires the involvement of state and private sectors to cooperate jointly, the entrepreneurial culture, which has a lot of potential, all of which is connected by the innovation ecosystem. It is essential that Slovenia develops a vision in the field of innovation: it can become a global innovation center, which requires centralization of the system in the form of innovation corridor, cluster… The government` s role is to be the main supporter, whereas the entrepreneurs are the main players. Decide on the direction of business incubators, which directly involve entrepreneurs. The state can finance companies so that they by themselves can commercialize the innovation«.

Mag. Ajša Vodnik, the Executive director, AmCham Slovenia:

“Entrepreneurship is certainly not the easiest, yet only by stepping out of the comfort zone, we can achieve success. Therefore, expecting that by financing the entrepreneurship and entrepreneurs by the state, there would be no private risk, is neither logical, nor practical.”

Working Lunch attended by H.E. Borut Pahor, the President of the Republic of Slovenia

President of the Republic of Slovenia on this opportunity in the role of active listener and commentator

Mag. Ajša Vodnik,

the Executive Director, American Chamber of Commerce – AmCham Slovenija, bid welcome to the partners of the International Investment and Development Conference U.S. – Slovenia Business Bridge, the Public Agency SPIRIT and the U.S. Embassy in Slovenia. She expressed her heartfelt relief that the U.S. Government temporarily shutdown has finished and had no significant consequences for the U.S. and the world.

She is convinced that partners by joining forces will do a lot of good for the Slovenian business and consequently social environment.

She expressed satisfaction that Slovenia has a president, who is so creative and who is aware of the fact that the world is changing and that we need to change with it. “Rare are the presidents who opt for the immediate challenge and answering the questions to which they can not prepare in advance.”

Sandi Češko on the important and hot topic – the privatization:

“It is true that until now only some of the state-owned companies were privatized, however significant changes occurred in recent years, especially in the mindset. Investors, who invested in privatized companies are very satisfied and know that their investments are safe, since in Slovenia there are no major risks. It is extremely important that these companies are over and over awarded as the most important in their global structure – such is for instance among many other the fine example of Goodyear Dunlop Sava Tires. Since the government committed itself to privatization and showed seriousness to achieve its purposes, it is a positive sign of confidence and changes in mindset, which means certainty for investment and assures the foreign investors that they will have their money safely invested, which in term of modern economy, means a great advantage.

He also revealed the wrong “mantra” of modern economic thinking, indicating that companies need to focus on markets with incredible growth and money. However, in his opinion, this is not necessary for some businesses, nor it is not enough to follow this “main stream” and focus on the markets – India, Brazil or China. The U.S. market is still the most competitive – which may seem fearful to some – but we all know that the competitiveness strengthens. The U.S. market is for its rapid technological development hungry for innovation, which means that from our perspective, America is “a magical land for business”. He announced the President of the Republic of Slovenia as the most innovative politician in Slovenia, who can show us how to be innovative also in the economy.

Slovenia is on the right path

Notwithstanding the different views among the parties, they are all willing to participate

Borut Pahor, the President of the Republic of Slovenia, said that he is attending the conference for the second time – the first time he attended it as the Prime Minister and this time as the President – and pointed put that in the meantime a lot has been changed – especially in the mindset of people as regards the foreign capital and foreign investments in Slovenia. “As the Prime Minister I traveled a lot throughout Slovenia and tried to convince people why some things were necessary and important – however, I am pleased now to note that the mentality has become different and is still changing. We are opening up. It is important to invite investors to Slovenia. In the next 5 years, I am sure, that we will change for the better, as signs indicating that Slovenia is on the right path, can already be seen.

However, we must take the next step and show the strong commitment of the government – especially as concerns the bad bank and privatization, where in addition to the package of the first 15 companies, I wish to see the next 15. I wish to see the commitment from the majority of the Slovenian policy – and at this point would like to inform the Slovenian entrepreneurs and others – YES, we will do so.

Certain questions should be answered by the Prime Minister. However, I accepted the duty to build bridges between the parties and the coalition. I wish for a consensus between the parties. I promised the leaders of the parties that I would try to find out what can we all together do for the economic growth. I wish to sum up all our knowledge and experiences into a package with proposals for economic growth. All leaders of parties will be present – the initiatives for it are being collected. It will not be easy, but the thing that matters to me is the feeling that whatever the differing views among the parties, they are all willing to participate. Now, no one is willing to accept the responsibility to destroy this government.

I have two priorities:

  1. political stability and
  2. political stability

I am talking with and listening to the common people, workers, managers, mayors and they are all after five years of crisis, certain that we have to in addition to medical and pensioners reforms achieve the structural reforms as well. I am actually all the time saying that we need to facilitate the procedures to start a business in order that Slovenia will be more attractive to foreign investors«.

State-owned companies – privatization and restructuring

»Our problem is in too much talking and too little action«!

Mitja Mavko, the State Secreatry at the Ministry of Finance presented the government` s view on the issue of privatization and pointed out the necessity of shoring up the banking system, poor corporate governance, debt and lack of domestic and foreign capital, unsettled fiscal stability…

»With the foreign investments we could reduce the public debt and achieve fiscal stability. Privatization is an opportunity for a fresh wind bringing fresh capital and a new model of corporate governance to our land. With foreign investments we could reduce our national debt and achieve fiscal stability«.

»I do not wish to give an impression that we are in time pressure, that we are totally desperate… We want to show willingness to cope with problems ahead. We do not wish to sell only the »silverware«, because the market is diverse and the buyers differently oriented«.

Matej Runjak, Member of the Board, SOD, highlighted the specificity and diversity of each individual privatization process. »It is necessary to determine the focus of sale and stick to the timeline. First, we want to privatize companies that are ready for the process and will create successful stories – positive messages. The first important step on the path of the successful privatization of the companies is the centralization of asset management«.

Archibald Kremser, CFO, NLB d.d.

Slovenia must be aware that it is not the only country wishing for foreign investments

Archibald Kremser summed up a part of the story of corporate restructuring in Slovenia, where one of the biggest challenges lies in many partners involved, on the case of NLB d.d. »The biggest challenge is the coordination and complexity of the collection of one transaction«, and pointed out that merely willingness for privatization is not enough: »Privatization is part of the competitive market – Slovenia must be aware that it is not the only country that wants foreign investments. The first step is that the country gives a positive impression with the wish for foreign investments expressed«.

Robert B. Irving, Head of M&A- Central Europe and Turkey, White&Case

At the time when many investors search for reasons why not to conclude a transaction, it is necessary to be competitive

»There are many reasons for the bad mood of investors in Slovenia. Slovenia has to constantly send a signal to the world that we want foreign investments, has to change the public perception – a positive story should prevail about the privatization. People need to understand that in the long run privatization will be paid off and that the growth will follow. It is essential to move the obstacles off the way before we begin the process of privatization: the ability and willingness to engage management, it is necessary to build a common opinion of all involved, so that there is no conflict of interest, it is necessary to set the regulatory frameworks… The sooner we do this, the more we will be competitive and the better outcome we can expect«.

Investment Opportunities in Slovenia

»We are short of economic optimism, there are not many of us that see the light at the end of the tunnel«.

Jaka Repanšek, MBA, Partner, RePublis Consulting, moderator of the event, pointed out that self-reliance is linked with self-perception of our country – if we believe in Slovenia, we will also more likely convince the investors.

Boštjan Skalar, Director, SPIRIT

If we are open, we will attract the »big eyes«

Boštjan Skalar is also convinced: »We have to be optimistic, no matter what is happening on the political and social scene in order to attract as much foreign investment as possible. Opportunities crop up every day, only trust is needed«, and at this point stressed out that the key to success is in integration: »We must feel and act as partners and not as competitors. In Slovenia, the main problem remains – who will be the boss, instead of asking ourselves what we want to achieve«. We must promote the »big story«, and not specific interests.

Nevenka Črešnar Pergar, Director, NP Consulting, sees as the main obstacle for attracting foreign investments in a too bureaucratic Slovenian environment. She proposes the following solutions: »The first precondition of moving forward is in the regulatory guillotine of legislation. The mindset needs to be changed, which is possible only with the right leadership, where employees are aware of the difference between governing and service. We must focus on anti-bureaucracy – particularly in the area of business and investment«.

There are in her opinion five points to solution: optimism, a long-lasting and difficult process of building an overall confidence, transparent public administration, effective corporate governance and a clear vision of the country we wish to live in.

Mag. Tomaž Lanišek, General Manager, Knauf Insulation

»Obtaining permits in Slovenia is already itself a project. We should be partners in this matter«.

Mag. Lanišek admits that according to his opinion we are not the most popular environment to attract investment, as the foreigners must have a warranty that the added value of the investment is higher than the initial input – it is only then, when they are ready to come. It is much easier if the international companies have a local management. »Besides, Slovenia is also large enough to test the development or production models to be consequently put on other major markets«.

Zev Gurion, Executive Director, Akron BioMedical corridor, Akron, Ohio

»You are your own biggest enemy. You are not optimistic. Change must happen within you. You must determine what is good and optimistic in you. Why would investors come to the country, where the people were depressed and convinced that the next day would be the end of the world? It makes no sense. Slovenia is wonderful, why don` t you announce it«?!?

Business Dinner attended by H.E. mag. Alenka Bratušek, the Prime Minister of the Republic of Slovenia

Evening full of positive surprises with the Slovenian Prime Minister and the U.S. Ambassador

H.E. Joseph A. Mussomeli: “Prime Minister Alenka Bratušek taking upon her own shoulders a role that many were too cautious or too timid to dare.”

H.E. Joseph A. Mussomeli thanked the distinguished business dinner guests and complimented the AmCham Slovenia Team, which had with a strong spirit and courage organized the event and congratulated the event sponsor Deloitte to celebrate 20 years of their work in Slovenia. He said: “I am honored – and even a little surprised – to be here tonight. Due to the suspension of the government in Washington, we were not sure if we could cooperate. I could tell you a lot more about the situation in Washington, but I wold rather keep my job.

Now let me say a few words about Slovenia. I won’t quote Twain again, but I will quote Shakespeare: “some are born great, some achieve greatness, and some have greatness thrust upon ’em.” Well, Slovenia certainly was not born great–even its gestation period to get born took many centuries! And it has not yet, at least, achieved greatness. But Slovenia has had a great many problems thrust upon it over the last few years. And as we all know, it is the problems and difficulties that beset us–and how we deal with them and face them–that determine whether we as individuals and as nations are judged to be great or small.

As you also all know strengthening business ties between our two countries is a priority for the Embassy. We would like to see Slovenia become a prime destination for U.S. investment, just as we hope that more Slovenian investors will look to the U.S. market. We see the benefits of this partnership every day–from Goodyear’s investment in Kranj to Studio Moderna’s success in the U.S. market–and we know there are many more similar stories. With its first-rate infrastructure, well-developed and highly-educated workforce, and geostrategic location, Slovenia should be an ideal place for U.S. companies to invest. Slovenia should be at the center of regional investments and regional operations.

Yet, we all know challenges remain in improving the business climate here. And it is honestly too soon to say for certain that Slovenia’s future is assured. But this government has accomplished more–and has survived longer–than many would have guessed. Under Prime Minister Bratusek’s leadership, the Slovenian government has striven to push forward with hard but necessary reforms to stabilize Slovenia’s economy: enacting the golden fiscal rule, securing support for privatization, reaching consensus on a modest VAT increase, and pressing forward with sensitive budget discussions that have helped to convince many skeptics that Slovenia can weather this storm. I will not deny or try to soften the truth that there are still many obstacles to overcome–both economic and political–and that there are many decisions that will take even greater courage and greater wisdom to ensure Slovenia’s prosperity and stability. But it remains my hope–and my expectation–that this government and this Prime Minister accept what destiny has thrust upon them. This is especially true of the Prime Minister. The Prime Minister has been a tireless advocate for Slovenia and she has surprised her critics by her tenacity and courage, taking upon her own shoulders a role that many were too cautious or too timid to dare.

So the next two years will be a defining period for Slovenia and for Slovenia’s leaders. Will Slovenia be merely another stale, but tolerably stable state or will it become the dynamic center of a re-energized region? In my view, having a Prime Minister who is committed to Slovenia–and to all Slovenes–and who is striving to make Slovenia the economic powerhouse of Southeastern Europe will be crucial to this success.

Slovenia is a victim of its own success

Mag. Alenka Bratušek, the Prime Minister of the Republic of Slovenia said that Slovenia was a victim of its own success: “We were blinded by our own success, as Slovenia was in the last two decades mostly very good, both in political and economic sense. Because of our achievements we overlooked our problems when it was time to resolve them; instead, we swept them under the carpet hoping they would remain there. Therefore the economic crisis caught us unprepared and thus Slovenia will need a little more time than other European countries with a similar situation to get out of the crisis: “A recovery will occur,” stated the Prime Minister and added that the present Government has right after its appointment started with adopting measures to restore competitiveness and stimulate the economy. “We believe that the proposed measures are appropriate and that the crisis can be solved by ourselves, without foreign financial aid“, was optimistic the Prime Minister. Among the priorities, the Prime Minister stressed the stabilization of the banking sector, consolidation of public finance and a new boost to the competitiveness of the Slovenian economy.

Helios is the proof that the government means seriously

At this point she stressed the reforms for improving the economic and business environment, which include better management of state-owned property. She noted that this strategy requires the government to sell non-strategic state investments. “The first privatization package consisted of 14 companies and one bank – of which we know that Helios was recently sold. This is another proof that the Government was serious when announcing that the privatization is one of the foundations of Slovenian economy recovery. She ensured the present potential U.S. investors that Slovenia is open to American investments and pointed out that as concerns the privatization, those companies will have the advantage, which will have a long-term interest in staying in the Slovenian market and solid business plans and strategies for business development.

Slovenia out of crisis already next year

The Prime Minister also stressed the overall economic recovery and despite some predictions that Slovenia will not get out of crisis until 2015, announced that it will happen already in the next year.

She rejected some critics that her government follows the dictates of the EU: “The reforms were not adopted because we would be told to do so by the EU, but because they are of our own national interest”.

The Prime Minister closed her address by underlining that Slovenia and the United States of America share the same values and convictions, which enables a good cooperation in the economic and political fields and pointed out that the U.S. investors and consumers are aware of the excellence of Slovenian companies and products: “Slovenian Elan skis are used in American ski resorts, our light aircraft flying in the U.S. skies and Slovenian medicines are used to improve health in the USA”. “The potential for our cooperation is great – especially in the field of foreign direct investment and there is no doubt that Slovenia is open for foreign investments – i.e. currently EUR 7.6 billion of foreign investment – but with only half a percent of it is from the U.S. On the other hand, the U.S. is the largest investor in Europe. The difference is obvious”, noted the Prime Minister and concluded by stressing out: “The excellent relationships between the two countries will logically result in a closer integration political and economic partnership and cooperation”.

H.E. Joseph A. Mussomeli had the honor of becoming an honorary AmCham Slovenia Member

At the dinner with more than 250 top representatives of the Slovenian economic and political environment as well as many distinguished foreign guests and potential investors, Ajša Vodnik, the Executive Director AmCham Slovenia and Thierry Villard, CEO Goodyear Dunlop Sava Tires and the first Vice-President AmCham Slovenia on behalf of the Board of Governors of AmCham Slovenia awarded honorary membership of AmCham Slovenia to the Ambassador of the United States of America to the Republic of Slovenia, His Excellency Joseph A. Mussomeli for all his support, devotion, affection and friendship for Slovenia and his many efforts and energy to meet the main task of the Embassy – strengthening the business ties between our countries. For strengthening the ties between the AmCham Slovenia and the U.S. Embassy, active involvement in the field of socially responsible projects and for the honorary sponsorship of the project AmCham Young ProfessionalsTM throughout his entire term of office.

AmCham Business Breakfast

The ball is still on our side

Joseph P. Quinlan: “You are down – I pull you up. I am down – you pull me up.”

For the first time in Slovenia – the man, presented by the U.S. TV network CNBC as one of the leading experts on global capital flows and one of the best connoisseurs of the transatlantic economy, Mr. Joseph P. Quinlan, Managing Director and Chief Market Strategist at U.S. Trust – Bank of America Private Wealth Management, who presented »The Case for Investing in Europe”

He presented his views on the benefits of the Transatlantic Trade and Investment Partnership – TTIP, between the USA and the EU, which in his opinion is with the aim of 13 million new jobs very ambitious, yet a necessary project that brings to both partners many advantages like: “You are down – I pull you up. I am down – You pull me up.”

Europe is rich – let` s unite

He clearly described the American interest in such a partnership: “The largest economy in the world is not represented neither by China, nor by America, but by Europe – not for its size, but for its wealth and prosperity. Large markets in terms of population, such as India, can not contribute to the improvement of the global economic picture, because they are poor. Europe is rich. We must find the balance between exports and imports between the two countries.” He also stressed that the U.S. is still a powerful economic player: “The ball is still on our side”.

He believes that even if the TTIP will not be entirely realized, the U.S. and the European companies will expand their networking and cooperation.

In his view, the major challenge for both partners of the agreement is in new job posts and in reducing unemployment – which should be solved exactly by the TTIP.

He assessed that the agreement will be in reality difficult to achieve, as we are on the one hand facing a recession and on the other strive to achieve economic growth. However, there have been seen some improvements in this matter.

“There is no perfect system, but we are jointly building a very strong partnership that gives us the potential that we all deserve. Also, the U.S. and the EU can together set the standards for the rest of the world”.

TTIP – Transatlantic Trade and Investment Partnership is not exactly »sexy«, but brings benefits

We, investors, always keep asking: “In what is this good for me?”

As a response to the rhetorical question, he enlisted some of the main advantages of the agreement:

  • Brings lower costs and greater trade and investment.
  • It is not about domination, but about a long-term partnership and a golden opportunity to strengthen our economies.
  • We both want the same – to harmonize and standardize the rules.
  • The numbers should speak for themselves.
  • The biggest advantage is the new job posts.

How to do Business with an in the USA

Gaetano Massara, CEO, GE South East Europe

»Gaetano Massara, who regionally runs one of the largest companies in the world – General Electric, said that they are extremely pleased with the partnership they have with the company Gorenje, and therefore believes that also other companies in Slovenia could become part of the supply chain, but noted that the companies that wish to be in partnership with them should have a high quality production and top-level design. He believes that these are exactly the merits of Slovenian companies and therefore points out that it would be worthwhile to explore opportunities for cooperation.

Tanja Makovec Petrik, Attorney at Law, Petrik Law Firm

The Slovenian, who lives and works in the United States, has focused primarily on the need to carefully examine the visa system and all legal matters relating to the company before entering the market, as solving issues in retrospect can considerably increase the costs.

Tomaž Groff, Ecobase Global

Tomaž Groff pointed out that the most important thing when thinking about leaving home for working in the USA, is to do a homework – at home – and to focus on own expectations and wishes. It is necessary to choose the best local consultants and partners in the U.S. market, who know the industry and its legalities. It is necessary also to inquire about the characteristics of consumers in the United States.

Jadranka Jezeršek Turnes, CO PoliMat

Jadranka Jezeršek focused on the importance of a well structured and focused communication skill, knowledge of the quick and successful presentation to U.S. investors, which may be in some cases essential, since without it, even if you have a top product, you can not obtain the capital needed.

Karen Mims, Consular Officer, US Embassy Ljubljana

U.S. Embassy spokeswoman described the concrete steps and the importance of detailed procedures for obtaining work visas.

Jurček Žmauc, Consul General of the Republic of Slovenia in Cleveland

Jurček Žmauc, Consul General of the Republic of Slovenia in Cleveland, highlighted a number of examples in which Slovenia and Ohio already cooperate and introduced the Association S- Abah, which is trying to bring together Slovenian companies and American friends in the USA.

Michal Smrek, Partner, White&Case (Europe) LLP, Prague

Michal Smrek focused on the NE Europe and explained that U.S. investors in this market are looking for ideas and innovations. Therefore, often large corporations buy the company in order to get the expert knowledge of employees included. He advises businesses to pay attention to the rights resulting from intellectual property. He noted that in this region the entrepreneurs often hide their products in order to try to make them ideal, but for it often lose their momentum in the market. Therefore, he jokingly added:” Decide whether you want to be rich, or “kings of your small yard”. He noted that it is necessary to globalize and recommended to entrepreneurs to really focus on technology and innovation, and not to try the excursions into the unknown and discovering something already discovered.

Focus on two states – Colorado and Ohio

Colorado and Ohio were presented at the US Slovenia Business Bridge Conference. Participants could find out that also there is quite an opportunity to enter the U.S. market, as the smaller countries are probably even more willing to invest in order to gain good partners.