Slovak Spectator 1715

8/7/2019 Slovak Spectator 1715

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Nothing to do? Build a castle!

ONE STONE to kill two birds: that isthe basic idea behind the CultureMinistrys heritage-protection-meets-labour-market-needs plan,under which some of the countryslong-termunemployedwillbe putto

work restoring Slovakias castles.The ministry said castle restoration

couldbe speededupbecauseof lowerlabour costs and at the same timejobless persons would get thechance to re-establish workinghabits that might have deterioratedduring long-term unemployment.Butnoteveryonemayfullysharetheenthusiasm of the ministry: similarprojects in the recent past, payingminimum wage, have hardly beenembracedbythoseseekingwork.

Beginning in May, unemployedpeople from nearby municipalities

are expected to start doing restora-tion work at two historical monu-ments ari Castle in eastern Slov-akia and Uhrovec Castle in westernSlovakia.

The pilot version of the projectwas presented by the Culture Min-istry and the Central Office of La-

bour, Social Affairs and Family(PSVaR), which deals with the un-employed.

SeeREPAIRpg4

NEWS

FicostartsbloggingSmer leaderRobert Fico haslaunchedhis own personalblog.Hischoice ofvenuewasslightlysurprising:thewebsite ofSme, a newspa-perhe haspreviouslyaccused of lying.

pg 2

ECRomastrategyA European Commissionframework documentaimedat spurring betterRoma-inclusionpoliciesinmemberstates hasreceived

a cautiouswelcome fromSlovakactivists.pg 3

OPINION

ThemagicphraseNolawhas beenbrokenisthe magic,formulaicre-sponsepoliticians oftentoss outin response toques-tionsabout deals thatarerottento theircore whenjudgedby ethical standards.

pg 5

BUSINESSFOCUS

Elixiror poison?The two biggesttelecomcompanies in Slovakia sawtheirrevenuesdip in2010andpartly blamedstateandEU regulators,while thethirdoperator praisedregu-lationas necessary.

pg 6

AdifferentpathThe Slovak Spectator spoketoPeterMaj,chief execut-iveofficerof Slovanet,an al-ternative telecoms pro-vider,about thefirm's dir-ectionand challengesfa-cingthe telecoms industry.

pg 7

CULTURE

Stretchingtheir styleThe Abhijit Banerjee Trio,leading exponents ofNorthern Indian classicalmusic,recentlyplayedtwogigsin Slovakia.The SlovakSpectator askedthem abouttheirapproachto music.

pg11

Twoshipscollidedon theDanuberiver canal nearamorn inthe earlymorninghoursofApril13. One,a Germanpas-sengerboat,wascarrying100people.Fortunately,noonewasinjured.Formore details,see pg2. Photo:TK

Tax boss in hot water

over office rental dealOWNERS of office properties inKoice might get another chance tobid on the leasing of office space toSlovakias Tax Directorate if PrimeMinister Iveta Radiov carriesthrough on the responses she madeto queries about a previously-inked,five-year, 6.6-million rentalagreement between a firm owned

by a regional official of her ownpolitical party, the Slovak Demo-cratic and Christian Union (SDK),andthe statestax authority.

The leader of the parliamentary

opposition, Smer chairman RobertFico, presented what he called astoryof partycronyismwhen hetoldthe media on April 11 that SlovakiasTax Directorate, headed by MiroslavMikulk, had signed a contractearlier this year to rent an office

building in Koice from Nitra Invest,

a firm co-owned by Ondrej urka,the chairman of the SDK branch inNitra. Fico hinted that some pro-ceeds from the lease might end up inSDK party accounts and called onFinance Minister Ivan Miklo, whohad nominated Mikulk to the taxofficeposition, to resign.

Mikulk maintained that thecontractwith Nitra Investis fullyinline with applicable laws and thattheleasewillsavethestatemoney.

SeeDEALpg10

Vol. 17, No. 15 Monday, April 18, 2011 - Sunday, April 24, 2011

FOCUSof this issue

On sale nowOn sale now FOCUSof this issue

TELECOMMUNICATIONS

RTVS bossunder fire

over payout

MILOSLAVA Zemkov, the recently ap-pointed director of public broadcaster Ra-dio and Television of Slovakia (RTVS), has

been pressed to explain her acceptance ofaround 17,000 in severance paymentsafter she left her last job, as director ofSlovak Radio (SRo), to move to RTVS. RTVS

was created by the merger of SRo and Slov-ak Television (STV) at the beginning of2011.

Zemkov in effect moved from one dir-ectorship to another, although she wasacting RTVS director for two months be-fore being confirmed in the job by parlia-mentin February.

SeePAYpg 5

BYBEATABALOGOVSpectatorstaff

Tenderwatchdogboss quits

ROMAN ipo had a rather short career asboss of Slovakias procurement authority.He resigned on April 11, after less than a

year in the job, following withering criti-

cism from Prime Minister Iveta Radiovof the operation of the Public Procure-mentAuthority (VO).

Radiov pointed to what she called arise in cancelled public tenders and theauthoritys failure to efficiently publishitsdecisionsfollowing audits.

But it is the question of ipos re-placement rather than his departure thathas resonated on the political scene. Op-position leader Robert Fico, who chairsthe Smer party, swiftly announced thathis party would nominate a candidate tolead VO and insisted that the position,

based on the traditional distribution ofpower, belongsto theopposition.

SeeVOpg2


BYMICHAELATERENZANISpectatorstaff

BYBEATABALOGOVASpectatorstaff

SLOVAK BUSINESS DIRECTORY

Contacts to more than 2,600 companies in 106 categories

SELECT FOREX RATES benchmark as ofApril 14

CANADA CAD 139CZECH REP CZK 24.27RUSSIA RUB40.73GREAT BRITAN GBP 0.88

HUNGARY HUF 26748JAPAN JPY 119.85POLAND PLN 3.95USA USD 144


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3/12

European Commissionprods on Roma strategies

CAUTIOUS enthusiasm ac-companies the EuropeanCommissions recently issuedframework document settingout priorities for tacklingproblems of Roma living inEurope. It certainly does notpromise to turn SlovakiasRoma shantytowns into mod-el communities overnight butRoma human rights activistscallitafirststeptowardsmoreconcerted effort by countriesoftheEuropeanUnion.

On April 5, shortly beforeInternational Romani Daycelebrated on April 8, theEuropean Commission re-leased its European Frame-work for National Roma In-tegration Strategies, with theaim to guide national Romapolicies and mobilise fundsavailable at EU level to sup-portinclusionefforts.

More than 11 million

Roma are estimated to be liv-ing in Europe, according todata from the Council ofEuropes Roma and TravellersDivision, and more than halfof them live in countrieswhich are members of theEU. It is estimated that Slov-akia has around 500,000Roma citizens. It is generallyacknowledged that Roma inEurope live in considerablyworse socio-economic condi-tions than other Europeansand face discrimination inthe job market as well as inother aspectsof society.

Despite some good inten-tions from national politi-cians,too littlehaschangedin

the lives of most Roma overthe last few years, said Vivi-ane Reding, justice commis-sioner and vice president ofthe EC. Member states have ajoint responsibility to put anendto Romaexclusion.

Educationspotlighted

Corresponding with theEUs broader Europe 2020 tar-gets for employment, socialinclusion and education, thenewly announced frameworkfocuses on four priorities:education, employment,health care and housing, andcalls on member states to setindividual national Roma in-

tegration goals based on theRoma population in eachcountry, and their current so-cio-economicstartingpoint.

All of the priority areasare relevant to Slovakia and

they are interlinked, RobKushen, the executive direct-or of the European RomaRights Centre in Budapest,told The Slovak Spectator, butat the same time he particu-larly highlighted the area ofeducation.

Educational outcomes forRomani children in Slovakiaare terrible, Kushen said, ex-plaining that Roma childrenare routinely and illegally

shunted into special educa-tion programmes. Withoutan education, Romani chil-dren will not be able to getjobs and will not be able tocontribute to the Slovak eco-nomyand society.

According to a survey insix EU countries, includingSlovakia, only 42 percent ofRoma children completeprimary school, compared toan EU average of 97.5 percent,and attendance by Roma stu-dents in secondary educationprogrammes across these sixcountries is estimated at only10 percent.

Most important to me isthat member states help en-

sure that all Roma childrencomplete at least primaryschool, Commissioner Red-ing said at the presentation oftheframework document.

TheroleoftheEU

NGOs working with Romacommunities welcome theframework document becauseit makes the EUs role in deal-ing with Roma inclusionclearer.

Its clear that the ECdoesnt want to take up therole of solving Roma prob-lems, and it wouldnt even beright because it would onlydeepen the alibis of member

states who could then say itsup to Brussels, Laco Oravecfrom the Milan imekaFoundation told The SlovakSpectator.

But the EU provides signi-

ficant financial resources tomember states to address theproblems of Roma and manypeople inside and outside gov-ernment institutions haveraised concerns about how ef-fectively these resources have

beenused.There was a need for

some kind of glue orsomething that woul dstrengthen the position of theEC in solving Roma issues on

the national level, Oravecsaid, adding that the symbolicimportance of the documentis that it puts more weight onRoma problems, making theissue one of the key prioritiesoftheEU.

The ERRCs Kushen be-lieves the framework is a stepinthe right direction, butthatonits ownit isinadequate.

The reason an EUstrategy is needed is becauseRoma exclusionis anEU prob-lem: exclusion stems from vi-olations of EUlaw andthe freemovement of Roma acrossmember-state borders meansthat poverty and humanrights violations in, for ex-

ample, Romania have a directbearing on France,he said.Kushen reiterated thatthe

primary responsibility fordealing with discriminationfaced by Roma should rest

with the member states butsaid the EU undoubtedly has arole: to enforce EU law and tosanction states for violationsof the Race Equality Directiveand the Free Movement Dir-ective; to provide funding forRoma inclusion initiatives;and to make sure that EU bur-eaucracydoes notstandin the

way ofEU fundsbeingusedef-fectively.

Nationalreports

aneffectivetool?

Criticism of the framework document has alreadysurfaced, withcritics sayingitis too brief and vague and that

it does not deal effectively with discrimination, preju-dice and women empower-mentissues.

It is positive that the EChas the tendency to set out

very clear and measurableaims for the member states,

but theseare only smallpiecesofa bigmosaic,Oravecsaid.

U nd er the EuropeanFramework for National RomaIntegration Strategies, mem-

ber states must submit na-tional Roma strategies by theend of 2011 specifying howthey will contribute to theachievement of the goals ofthe document.

Member states must alsoappoint national contactpoints to manage, monitorand report on the implement-ation of their Roma integra-tion strategy. The EC will is-sue annual reports on wheth-erprogress hasbeenmade.

Depending on nationalstrategies as the main re-medial tool might not be veryeffective, according to Oravec,

who said national govern-ments will not find it difficult

tojustput strategieson paper.I am sceptical whetherthis will not just be a formaltool, easy to report, Oravecstated.

Slovakias Office of theGovernment Plenipotentiaryfor Roma Communities hasalready said that submittingnational action plans forRoma integration will notbe aproblem since the country iscurrently revising its nationalaction plans for the Decade ofRoma Inclusion, 2005-2015, aregional initiative under-pinned by the Open SocietyFoundation and the WorldBank.

In the strategy that the

EC expects from us we willtake account of the actualisednational action plans for theDecade, Iveta Duchoov,the offices spokesperson, toldThe Slovak Spectator.

BYMICHAELA

TERENZANI

Spectator staff

TheEC saysall Romachildrenshouldat leastfinishprimaryschool. Photo:Sme- P.Funtl

Wind and fire hitSlovak forests

TWOnatural disasters hitSlovakia in midApril. Afterstrongwinds caused severedamagein north-eastSlov-

akia forseveraldaysbegin-ning onApril8, largeareasofvirgin forestin central Slov-akia weredestroyed bya firethatstarted nearthe villageofStarHoryon April9.

Forthree days,strongwinds classifiedas awhirlwind blew overtheHighTatra mountainscaus-inglocal authoritiesto issueastateofalertfromthemorning ofApril8 untilnoon onApril11.

Locals inthe Tatrasstillvividlyremember the2004naturaldisaster whenstrongwinds damagedstripsof thehighforestsandsignificantly changedthe

faceof thepopular moun-tain resortarea.This time damagein-

cluded manyfallen treesandseveralroofs blownapartbythewind. Most damagewasreported inthe districtsofPoprad, Levoa, Gelnica andSpisk Nov Ves, aswellasinthe Oravaregion.

TheSITAnewswirere-portedthatdamage intheHighTatras amounted to250,000.The windalsocaused complications in loc-altransportas cablecarsinthemountainssuspendedoperationsforthreedaysandpartsof thelocal tram routes betweenStar Smokovec

andTatranskLomnica wereclosed as well.Thestate-runforest ad-

ministrationin the HighTatrasreporteddirect dam-ageto theforestsof 750,000upto April11 andanother17,000 in propertydamage.

TheSlovak Hydro-Met-eorologicalInstitute (SHM)issuedstrong-windwarn-ings aswellfor April 12forthewestern-Slovak regionsofZhorie andtheDanubelowlandsas well asfor dis-trictsin northern Slovakia:Orava,Kysuce,Turiec,Lipt-ov,Horehronieand Spi.

No damage, however,

wasreported in westernSlovakia.

Butwindalone wasnottheonlysourceof destruc-

tion inSlovakforests. Inthevillageof Horn Jelenec-Star Hory, inBanskBystricadistrict, fire startedaroundnoon on April 10 and

withinone dayconsumedalmost100 hectaresofmixed forests, parts of

whichwere inaccessiblevirginareas.

Accordingto SITA,thefirecaused damageamount-ingto 222,000and that 178professionalfire fightersfromBansk Bystrica,ilina,Preovand BratislavaRe-gions,along with20 cisternpumps,wereon thescenetocope withthefire,accom-paniedby membersof local

firefightinggroups andforestworkers. Fourheli-coptersfromthe armedforcesandthe interior de-partment helpedto extin-guishthe fireas well.

Theteamsof firefightersmanaged tobringthe fireundercontroland preventitfromspreadingfurther ontheeveningof April 11.

Id belyingif I didntsaythat Imsatisfied,Alex-anderNejedl,the presidentof theFirefighterand RescueCorpssaidat a press briefingonthe evening ofApril11, asquotedby SITA.Wevedonederring-dohere; theboyshave gone tothe bottomof

theirpowers, carrying ma-terialon theirbacksto al-mostrock-climber terrain.

OnApril12,threedaysafterthe firebrokeout,thefirefighters managed to ex-tinguish theflames. Thecauseof thefireremains un-knownat this time.

Abig firehadcauseddamagein thesameregion,

but onthe oppositeslopesoftheJelensk valley, in April2007.That blazeaffected113hectares offorests andtook10 daysto extinguish.

CompiledbySpectatorstaff

frompress reports

A firerampagedthrougha forestnearStarHory.Photo:TASR

3April 18 24, 2011NEWS

Europeanframework

document seeks

concertedaction


4/12

Peugeot to bring 900 jobs to Trnava

ANINVESTMENTbycar-

makerPSAPeugeotCitroenworthmorethan 120mil-lion,to produce a newmodelin Slovakia,will result inabout900 newjobs, thepres-identof PSAPeugeotCitroen,PhilippeVarin,announcedaftera meetingwith PrimeMinisterIveta RadiovandEducationMinisterEugenJurzyca inTrnava onApril11,theTASR newswirereported.

TheTrnava-basedplantintends tolaunch a thirdworkingshift a yearfromnowand graduallyincreaseannualproductionto a max-imumcapacityof 300,000vehicles.Thenewmodelwillbethethirdto bemanufac-

turedin Trnava.Itshows that carmanu-

facturingwithinthe PSA

PeugeotCitroenGroupanditspersonnelhavereachedfullmaturity,Varin said,asquotedbyTASR.On theoth-erhand,it'salsoa confirma-tionof thestrategiccharac-terof ourinvestmentinSlovakia,with theplannedgradualincreasein effect-ivenessof thealreadyexist-ingcapacities.

Varinand Jurzyca signeda Memorandumon Coopera-tion inthearea ofsecondaryeducationbetweenthe Edu-cationMinistry and PSAPeugeotCitroen afternegoti-ationswere completed

between theFrench Ambas-sadorin Slovakia,Jean-Marie

Bruno, and theSlovak Ambas-sadorto France, MarekEtk.

Coke is not the sameeverywhere

THEWORLDS best-knownsoftdrink, Coca-Cola,is notexactlythe samein SlovakiaasitisinGermanyorintheCzech Republic, recenttestsbySlovakiasConsumer Associ-ation have revealed.

Theassociationhadsixbrandedproducts purchasedineightcountriesof theEUtestedby theSlovakVeterin-aryandFoodInstituteandfoundthat some transnationalconcernssell,underone brand

andin thesamepackaging,productswith different con-tents, theSmedaily reported.

TheCoca-Colaproducedinfourof thecountries,includ-ingSlovakia,containediso-glucose,whilein theotherfoursamplestherewas nosign ofit andsucrose wasusedinstead,Sme wrote.

The Consumer Associ-ationsuggestedthat isogluc-oseis used foreconomicreasons: itcostshalfwhatsucrosedoes.

ZdenkVilmekof Coca-Cola,however, toldthe Smedailythatthe reasonforthedifferenceis technological.

Ourplant inLkanearPieanyis equipped fortheproductionof drinkwith li-quidfructose-glucosesyrupand it cannot process crystalsugar, he said,addingthattherecipe forproductionofthesyrup isthe same allaroundthe world.

Onlyone productwas the

same inall thetestedmar-kets:MilkaAlpinemilkchocolate.Thebiggestdiffer-ences inqualitywerefoundinKotnyi blackpepper.

The tested productswerepurchasedby mem-bersof theassociation innormal supermarkets inGermany,Austria,Poland,Slovakia,the CzechRepub-lic,Hungary,BulgariaandRomania.The products

weretestedboth scientific-allyand sensorially.

Slovakia's population is ageing fast

BY2050 almost fourin tencit-

izens ofSlovakiawillbe aged60 ormore,according totheAllianzDemographicPulsestudy,the SITAnewswirere-ported.Currently, peopleover60makeup19 percentofSlovakiaspopulation. Accord-ingto thestudy,theincreas-inglongevitywhichpartlyac-counts fortheriseis a resultofhugeprogressin healthcareand social conditions.

By2050,governmentex-penditure on pensions,socialcareand healthcare willcon-stitutealmost30 percentofGDPin theeurozone, SITAre-ported,citing thestudy.Slov-akiawillbe underthe averageof theEuropeanUnion,witha

shareof 20.4percentof GDP.In Slovakia,thebiggestpercentage increasein costsrelatedto theageingpopula-tionis expectedtobe intheareaof pensions.

Overall, in connection

withthe increasing ageof thepopulation,the costsof pen-sions, socialcare, educationandhealth carewillriseby5.2percentof GDPby 2050 inSlovakia,the studypredicts.

The studyalso researchedestimatedlongevity.Increas-inglife expectancytogetherwitha fall inthe agelimit forretirementby theendof1990sled toan enormousin-creasein thetimepeoplespendin retirement.In de-veloped countries,menspendaround 20yearsin re-tirement on average. On av-erage,peoplein Francespend24 yearsin retirement,whileSwisspeoplespend 16.8

years. According to the study,Slovak menspend 16.3yearsandSlovak women25.1 yearsin retirement.

Compiledby Spectatorstaff

REPAIR: Jobless to

restore monumentsContinuedfrompg 1

Both government officesstate they are seeking to offera single solutionfor twoprob-lems: deteriorating monu-ments and long-term unem-ployment. PSVaR will con-tribute by selecting personsfor the project from amongthose registered at regionallabour offices, while contrib-uting funds re-allocated fromcancelled or ineffectiveprojects.

Theinitial plans callfor 20long-term unemployedpeople to start working atUhrovec Castle with an addi-tional 30 to report to ari.

PSVaR expects the projectnot only to have a positiveimpact on the countrys em-ployment figures but also tohelp the jobseekers maintaintheir working habits andprovide them with a betteropportunity for employmentin the labour market after theproject ends, PSVaR spokes-personDanica Lehocksaid.

Protection and restora-tion of historical monumentsis among the priorities of Cul-ture Minister Daniel Krajcer,

who announced earlier inMarch thatprojects to protectand restore national monu-ments in 2011 will receive thehighest amount of state fin-

ancial aid ever, amounting toabout 144 million, most of itcoming from the EUs Re-gional Operational Pro-gramme, and much smalleramounts coming from tour-ism support programmes andfrom the Norwegian Finan-cial Mechanism.

Learningdifferent skills

Krajcer is very enthusiast-ic about the project and calledit a win-win approach, sayingit brings immediate benefitsto unemployedpersonsas wellasto thecastles.He also statedit will have additional longer-term benefits as it will provide

participants with professionalskills that they can use afterthe project ends, as well asadding to the development oftourism in the regions sur-rounding the castles.

The Culture Ministry willprovide about 100,000 fromits grant system to financethe project and will serve asits professional guarantor. Aprecondition for a castle to

be included within the pro-grammeis for itto alreadybepart of the activities of civicassociations that deal withprotection of monumentsand for some protection

work to have already beenstarted in cooperation with

localauthorities.Eva Chudinov , thespokesperson for the CultureMinistry, said that workshopstake place atthe castlesduringthe summer focused on pro-

fessional restoration or con-servation of castle ruins, not-ing that this is done under thesupervision of civic associ-ations as well as under the ex-pert supervision of regionalmonumentprotectionoffices.

The unemployed can firstperform easier work, such ascleaning, seeding green areasor manipulating materials,and can then gradually be-come acquainted with moredemanding skills such asstonemasonry or carpentry,Chudinov said.

Is theremotivation?

Some observers warnagainst too much optimismand point to similar projectsfrom the past that did notmeet with much enthusiasmor success among the long-term unemployed. Psycholo-gists have noted that after

long periods of unemploy-ment peoples working habitsdeteriorate and they may findit very hard to return to the la-bourmarket.This mayexplainthe experience from a projectthat was launched by the La- bour Ministry in 2010 afterSlovakia was hit by massivefloods. The ministry soughtlong-term unemployed per-sons to do work such as clean-ing riverbeds and authorised835 job positions in coopera-tion with the affected muni-cipalities but only 212 peopletook up the opportunity, theSme daily reported, notingthat earning the minimum wage of just over 300 per

month was apparently insuf-ficient motivation.Lehock said Slovakias

current system of social al-lowances, and how they aredistributed when someone

participates in this kind ofwork,is atfault.

Drawing social allow-ances is in some cases prefer-able to working, Lehock toldThe Slovak Spectator, explain-ing that receiving any paid in-

come lowers the amount a

person receives in social al-lowances.

How much those workingon a castle reconstructionproject would earn has not beenannounced but it is not likely to

be much higher than the min-

imum wage. However, thechairman of the Freedom andSolidarity (SaS) party, RichardSulk, announced that new le-gislation that is already underpreparation could motivatelong-term unemployed personsto seek work, mentioning thepayroll-tax reform plan ad-

vanced by the government. Hesaid even though the mostcomprehensive changes areplanned for 2013, special rulescould be designed even earlierfor the castle reconstructionprojects so that a persons socialallowances will depend on real

work activity.It will not [continue to]

work in the way that social al-

lowances will be also for those who dont want to workanymore, Krajcer said, asquoted by the TASR newswire.We are creating more spaceand possibilities so that people

can deserve the allowance, orgetmoney through theproject.

Along-termproblem

Unemployment statisticsshow that Slovakias unem-

ployment rate reached a post-crisis high in February of 13.16percent, up 0.18 percentagepoints compared to January. Inhuman terms this meant that395,445 people were registeredas unemployed, according todata from PSVaR released onMarch 21. The jobless rate inFebruary 2011 also stood 0.19percentage points higher thanthe same month in 2010 andmarked the highest number ofunemployed Slovaks sinceJanuary2005.

In addition,statisticsfromEurostat indicate thatSlovakiahas the highest long-term un-employment rate in the EU.Eurostat wrote that in the

third quarter of 2010, Slovakswho had been unemployed fora year or longer represented9.4 percent of the labour force,compared to an EU average of3.8 percent in that quarter. La-bour market experts say thosetrapped in long-term unem-ployment are primarily per-sons with low levels of educa-tion and poor qualificationsand note that these peoplemay lose their working skills,habits and job knowledge andseverely lessen their chancesof finding workagain.

Slovakias job offices re-gistered a total of 184,694 long-term unemployed atthe end of2010, or nearly 50 percent of

the total number of unem-ployed persons. This was anincrease of 44,581 sinceDecember 2009 and an in-crease of 77,174 compared withDecember 2008.

RestorationworkatUhrovecCastle. Photo:Courtesyof PeterHoransk

4 BUSINESSApril 18 24, 2011

Drawingsocial

allowancesis insome

casespreferable to

working.

DanaLehock, PSVaR


5/12

Vratka

IT HAS to be a vratka. It

makes no other sense, saidopposition leader RobertFicoabout the recent property-leasing scandal of the SlovakDemocratic and ChristianUnion (SDK), turning anexpert term previously used

by accountants, auditors,and businessmen intoSlovakiasword of the week.

Until now, vratka de-scribed a VATrefund.Thanksto Fico, it has become a syn-onym for money that politic-al parties siphon from publicfunds. Of course the mannerin which the Smer leaderusedit indicatesthatit isnotnew to his vocabulary. Butthe previous coalitions mis-

deeds are no excuse for thesevensins ofthe current one:1. Conflict ofinterest.

Not only was the public notnotified in advance that anofficial appointed by theSDK was signing a dealwith a member of the sameparty, but tax office bossMiroslav Mikulk claimedthat he himself did notknow about the ties. Giventhat Mikulk is closefriends with Finance Minis-terIvan Miklo, whois closet o SD K b os s M ikulDzurinda, who is close tothe lucky entrepreneur,

Ondrej urka, this does notseemvery convincing.

2. Notendering. A prop-er tender could have easeddoubts about the conflict ofinterest. The fact that the

deal was agreed directly withurka would make thetransaction suspicious, evenifit wasnotan SDK regional

boss who was on the receiv-ingendofthedeal.

3. The use ofoff-shorecompanies. The company

whose building the tax officeis moving into is co-owned

by a firm registered inCyprus. Now, it is hard to ar-gue with Prime MinisterRadiov when she says thatthat country is a regularmember of the EU. Still,Cyprus is not known for itstransparency.

4. Thebreachof electionpromises. The use of off-shores is particularly amus-inggiventhefact that in theirelection manifesto the SDKpromised to guarantee thatcompanies whose owners are

not identifiable will not beable to sign agreements withthestate.Well, here yougo.

5. Lies. Mikulk haspresented severalversions ofhow his office found thecompany and signed thecontract. Obviously, theycannot allbe true.

6. Nosanctions.Nooneis going to pay for any of theproblems. The tax office dir-ector and the finance minis-ter are keeping their jobs,the company is keeping itscontract.

7. A crazyquasi-solu-tion. Radiov says that ifanyone has a better offerthan the one introduced by

her party colleague, they willterminate the agreement.What sort of an entrepreneurwould want to make a fool ofthe tax office boss? And isthis how the governmentplans to function handingout contracts to cronies inthe hope no one will find out,andonlyif someone does, let-tingothers compete?

If this is the way theSDK and Radiov plan tooperate, they will soon findthat political fate can be very

vratk (uncertain) and votersmay well show them the

vrtka(littledoor).

BLOG: More space for argumentContinuedfrompg2

Accordingto Sudor, however, politiciansusingthe blog.sme.skservice are mainlyfromthe right-of-centre sideof the politicalspec-trum especiallySaS, whose2010 electionsuccess wasbuilt partlyon theactivitiesof itsmembersin the blogosphere.

RobertFico admittedthat thereadershipnumbers ofthe Sme website were a motiva-tion.

Onthe onehandtheSme dailyis rightistandsupports [PrimeMinister]IvetaRadiov,thats obviouslyclear, Ficotold

Sme. But letsbe objectiveandadmitthattheirinternetportalis thebestand themostread.

The media,however,noted thatRobertFico hasconsistently beenat odds withtheSmedaily anditsjournalists,andhas re-peatedly accused Smeof printing lies andmisleading itsreaders.Butthatdid notpre-

venthim fromstarting a blog onthe samedailys website.

He is a politicianwithoutscruples,politicalanalystGrigorij Mesenikov toldTheSlovak Spectator.For him,everythingthatmeetsa purpose is acceptable.

The magic phraseNO LAW has been broken, isone of those magic, formulaicresponses that politicians of-ten throw to journalistswhenever the media starts

digging into deals that mayformally meet legal standardsbut maybe rottento theircorewhen judged by ethical stand-ards.

Thefrequencyof a particu-lar politicians use of thisphrase often depends onwhether he or she is at thatmoment in the opposition oris in the countrys govern-ment. Sometimes even thosemost eager defenders of theno law has been broken and

the deal is alright responsemorph into harsh critics ofthe phrase when it is notsomeonefrom theirown polit-ical tribe who stands to bene-fit. Smer boss Robert Fico hasoffered an exemplary insightinto this chameleon-like ap-proach.

Understandably, with thefrequency that the phrase hasbeenused in Slovakia,journal-ists (and maybe even citizens)are becoming concerned (andperhapsa bitangry) wheneverquestions about cronyism oru neth ic al cond uc t areroutinely dismissed withtheseparticular words.

All in all, no law has been

broken has been pretty muchthe response from political of-ficialdom to qualms about thecontract Slovakias Tax Dir-ectorate, headed by MiroslavMikulk, signed earlier thisyear toleasean officebuildingin Koice from Nitra Invest, afirm co-owned by Ondrejurka, the chair of the Nitrabranch of the Slovak Demo-cratic and Christian Union(SDK). Not only do the stor-ies about how Nitra Investwas chosen ring hollow, butthe explanations about thefirms background have only

raised new questions ratherthan satisfactorily answeringthe initial ones.

The deal, worth 6.6 mil-lion, may be unlikely to snapanyones political neck even

though there certainly couldhave been a more elegant wayof responding to the contro-

versy than posing the ques-tion: Should a party member

be handicapped or discrimin-ated against? That curiousquote comes from Mikul

Dzurinda, boss of the SDK, who contended that the whole process had beenabove-boardand transparent.

Nevertheless, Prime Min-ister Iveta Radiov properlyasked the Tax Directoratesdirector to take new bids tofind office space in Koice andadded that if a cheaper offermeeting all requirements issubmitted, he should cancelthe current contract. One canonly guess why she did notorder the deal be dumped firstand then a new, transparenttender could be started in

which urkas firmcould bid.Is it because those who

pull the strings in her partywould not have liked that de-cision or is it because she isconvincedthatthe deal hasno

blemishes?Recent weeks offered an-

other version of the no lawshave been broken excuse

when Miloslava Zemkov, thedirector of Radio and Televi-sion of Slovakia (RTVS), tookaround 17,000 in severancepayments plus a generous13,000 bonus when depart-ing from her last job as direct-orof SlovakRadio (SRo)to takethe helm at RTVS. We are told

that her severance pay wasbasedon a last-minutechangeto the collective agreementnegotiated between the tradeunions andmanagement.

Zemkov, who will soonstart laying off hundreds ofpeople from RTVS, first defen-ded her severance and then,

when pressed for explana-tions and a return of themoney, said she actuallycouldnot doso because SRonolonger exists and anyway, shehad already given her sever-ance to charity. As of April 14Slovakias taxpayers had yetto learn which lucky charity

benefited so generously fromtheirtaxes.

Oddly, Zemkov was notknown as a public servantwho carried along a suitcaseof controversial or nonsensic-al decisions or as an apple pol-isher to whatever politicianshappened to be in power. Soone can only incredulously

wonder why a public servant with such a good reputationcould use such bad judgement a blunder that the Slovakpublic will be more likely toremember than any futuresteps she might take to healthe ailing, debt-ridden public

broadcaster.

5OPINION / NEWS

QUOTEOFTHEWEEK:Iwould sign a contractlikethisevenwiththebrotherof Smers chairman.

MiroslavMikulk,the headof theTax Directorate, reactsto claimsby Smerthat hesigned a sweetheart deal with anallyof oneof therulingcoalition parties. SLOVAKWORD

OFTHEWEEK

EDITORIAL


BYLUKFILASpecial to the Spectator

April18 24, 2011

PAY: Speaker Sulk says bonus is fineContinuedfrompg1In addition to her sever-

ance payment, Zemkov alsoreceived a bonus worth threetimes her former monthlysalary, meaning that she waspaida total of around 30,000upon leaving her old job asSRo director, the Sme dailyreported. The bonus was ap-proved by the SRo Council,which oversaw the public

broadcaster.However, one council

member, Michal Dzurjanin,told the Sme daily that councilmembers did not know about

Zemkovs severance paymentand would not have voted forthebonusif they had.

RTVS spokeswoman Al-exandra tullerov Koreovsaid that Zemkovs working

relationship with SRo hadended and that she was en-titled to the severance pay-ment. She remained tight-lipped about the exact sumZemkov received but ac-cording to Sme, Zemkovsmonthly salary at SRo was4,282.

Zemkovs severancepay-off was based on a last-minute change to the collect-ive agreement between SRoand trade unions, which es-tablished a severance pay-ment of four times hermonthly salary.

Culture Minister Daniel

Krajcer, who was behind thecreation of RTVS, refused tocomment on Zemkovs bo-nus and severance paymentsand suggested that the issuewas forthe RTVS Council,the

steering body of the merged broadcaster. Nevertheless,his Freedom and Solidarity(SaS)party colleague,Speakerof Parliament Richard Sulk,called on Zemkov to returnthe severance payment, sug-gesting that she was notmorally entitled to it, theSITAnewswire reported.

On April 12, tullerovKoreov said that it wasnot clear to whom Zemkov would return the moneysinceshe waspaidit by SRo,which no longer exists, andnot RTVS. Zemkov hasnow given the money to

charity, the spokeswomansaid, without specifyingwhich one.

When it came to the bo-nus,however, Sulk saidthiswas justified.

She deserves one suchpayment because she has

been leading the radio withexpertise and dignity and theresults of SRo cannot be com-pared with the results ofSTV, Sulk said, as quoted bySITA, referring to the finan-cial crisis which RTVS is nowfacing as a result of the hugedebtsit inheritedfrom STV.

In a brief interview withSme on April 9, Zemkovsaid that she does not in-tend to return the severancep ayme nt as, she said,everyone who leaves theirjob has the right to a sever-

ance payment. She also ar-gued that even though sheis not jobless, her job asRTVS director does not rep-resent a continuation of herpreviousrole.

The Slovak Spectator i s an independent newspaper publi shed every Monday by The Rock, s .r .o.Subscrptions: Inquiries should be made to The Slovak Spectatorsbusiness office at (+421-2) 59 233 300.Printing: Petit Press a.s. Distributon: Interpress Slovakia s.r.o., Mediaprint-kapa s.r.o., Slovensk pota a.s.Mail Distribution: ABOPRESS. EV 544/08. 2010 The Rock, s.r.o. All rights reserved. Any reproductionin whole or in part without permission is prohibited by law. The authors of articles published in this issue,represented by the publisher, reserve the right to give their approval for reproducing and public transmission

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is the responsibility of the advertiser and is not a written or implied sponsorship, endorsement or investigation of suchcommercial enterprises or ventures by The Slovak Spectatoror The Rock s.r.o. SSN 1335-9843.Address: The Rock, s.r.o., Lazaretsk 12, 811 08 Bratislava. IO: 313 86 237.

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6/12

Slovak Telekom on strike alert

TRADEunionmembersworking for thebiggesttelecomoperator in Slovakia,SlovakTelekom(ST),went on strikealerton April11, the financialdailyHospodrskeNovinyreportedonApril14. Theactionwasin protestat acompanyplan tolay offas many as730workers,a steep

rise fromthe 280originallyplanned.According to theSITA newswire,the company employed4,650 peopleas oftheendof 2010.Aboutonequarter ofST employees aremembersof localtradeunions,the dailywrote.According toMilanBrlej,theheadof thePostsandTelecommunicationsUnion,achangein thecompanysprofittargetsby STsshareholdersmightpreventthe labour reduction.DeutscheTelekom isthemajority holderin ST,with51percent. Therestis held bythe EconomyMinistryandtheNational PropertyFund.Ameetingwith STdirector-generalMiroslavMajoro, atwhichtradeunions assertedthat theemployerhadviolatedtheLabour Code andfailedto meetthetermsofthecollectiveagreement,did notbring anyagreement onthenumber of layoffs.Accordingto HospodrskeNoviny,the EconomyMinistry,as oneof theminorityshareholders,willnotintervene.Thisis amatterfor thecompanysmanagement,said

RbertMerva, spokespersonof theEconomyMinistry, asquotedby thedaily.So farit isonlybargaining.We donotexpect thesituationto sharpensomuch that ourinterventionwill beneeded.


Telecom companies in Slovakia

Mobileoperators:-OrangeSlovensko,www.orange.sk- SlovakTelekom, (T-Mobileand SlovakTelekommergedas ofJuly1, 2010 andthelatter becamethesuccessorcompany)www.t-mobile.sk- TelefnicaO2 Slovakia,www.sk.o2.com

Someprovidersof fixed-line services:- AntikTelecom,www.antik.sk-GTSSlovakia,www.gts.sk-OrangeSlovensko,www.orange.sk- SlovakTelekom,www.slovaktelekom.sk- Slovanet,www.slovanet.sk- Swan,www.swan.sk-UPCBroadbandSlovakia,www.upc.sk-SR- elezninTelekomunikcie,www.zt.sk

Othercompaniesactive in telecommunications:-DigiSlovakia,www.digislovakia.sk-Energotel,www.energotel.sk-NokiaSiemensNetworks Slovakia,www.nokiasiemensnetworks.com- Satro,www.satro.sk- SESAstra, www.ses-astra.com-Towercom,www.towercom.sk-Vnet,www.vnet.sk-WiMAXTelecomSlovakia,www.wmx.sk

Institutions and organisations in the

telecom sector in Slovakia

Ministryof Transport, Constructionand RegionalDevelopmentMinister: JnFigewww.telecom.gov.sk

TelecommunicationsOffice(TSR)- TheT SRis Slovakiasregulatoryand pricingauthoritycovering theelectroniccommunicationssector.www.teleoff.gov.sk

ITAssociation of Slovakia(ITAS)- ITASis a professionalassociation representingthe mostimportant localand internationalcompanies operatingin theSlovak informationand communicationstechnologymarket.www.itas.sk

Competition is intense

LAST year, Slovak telecommu-nications operators continued

to fight for customers andsearched for ways to overcomedecreasing revenues that theysaid were caused by both theeconomic crisis as well as gov-ernment regulations. Marketwatchers expect that the

launch in June of a large 3Gnetwork by Slovakias newesttelecom operator may furthersharpen competition this year,andsay thegrowingpopularityof smart phones and similardevices will require all the ma-jor operators to roll out moresophisticated and faster ser-vices.

Fights for price-sensitiveclients, of whom there aremore and more, continued last

year, Filip Hanker, an expertand the editor-in-chief ofZive.sk and MobilMania.sk,told The Slovak Spectator,adding that in the voice seg-ment of the business there isnot very much new to offerfrom the marketing angle andthat operators are forced to re-duce the price for calls. An-other trend is a drop in pricesfor short messages and sup-plementary discounts for acombination of servicesthrough which operators en-deavour to maintain an ad-equate average revenue peruser.

According to Hanker, oper-

ators arekeepingan eyeon cus-tomers who have minimumcommunicationsneedsas well,offering them various kinds of

bare-bones service packages aswellas lower pricesfor pre-paidcards.

It is still more convenientfor operators to keep these cli-entsthanto releasethem tothecompetition, Hanker said. Headded that this is partly be-cause quoting a larger numberof customers in a firms finalresults looks better, but is

mainly so because such cus-tomers can later trade up to adifferent product, start to usethe internet as well, or simply

because customers from othernetworks will call these low-usage persons and the operatorcan earn revenue from inter-connection fees. Operators arealso continuing in their effortsto increase revenues from theinternet, Hanker said, addingthat he is certain that the oper-ators see internet-generatedrevenues rising for many yearsto come. This is why they haveoffered various products eventothosewhoneedtousethein-ternetonly occasionally.

Slovakias dominant tele-com operators, when assessing2010, complained about bothnational and EU regulations

which theysaid impactedtheirrevenuestreams.

The factor which cur-rently affects the developmentof the Slovak telecom market isits general saturation and stag-nation and simultaneously theunceasing regulation from thesideof thenationalregulatoras

well as the EuropeanCom mis si on, Andr ej

Gargulk, the spokesperson forSlovak Telekom (ST), told TheSlovak Spectator. Growth wasseen especially in the segmentof digital television and mobiledataservices.

Slovak Telekom mergedlast year with sister companyT-Mobile, and in late FebruarySTs general director, MiroslavMajoro, described 2010 as oneof the most demanding yearsfor his company. The mergerprocess is not yet over as thecompany will undergo furtherrestructuring in 2011 eventhough it laid off 150 staff last

year, primarily from mana-gerial positions. A larger reduc-

tion in the companys labourforce, whichnumbered 4,650atthe end of 2010, is expected tocome this year, according totheSITAnewswire.

ST closed its 2010 financial year with total consolidatedrevenues of 934.3 million, adrop of 4 percent, even thoughits number of active mobile cli-ents increased by 31,000 to2.246million,SITA reported.

Orange Slovensko also putprice regulation and theslowly-ending economic crisis

as the main factors that af-fected it last year. Its revenues,at 763.8 million for the year,shrank by 6 percent comparedto 2009. The company attrib-uted almost all of this fall 5.8percentage points to priceregulation.

When the influence ofregulation is not taken intoconsideration, Orange actuallyreached revenues at the 2009level, Peter Tth, corporate af-fairs manager at Orange Slov-ensko, told The Slovak Spectat-or. This means that after a

year of decrease, Orange man-agedto stabiliseitsrevenues.

Tth added that Orangemanaged tocompensatefor the

negative impacts of regulationand the crisis by growing itstelecomservices, asthe volumeof voice services grew by 3 per-cent and data services in-creased by as much as 68 per-cent.

But in contrast to the othermajor telecom operators, thenumber of active Orange cus-tomers decreased by 21,000, or0.7 percent, to 2.87 million.Tth said that his companyperceives this small decline to

be an excellent result based onthe level of competition inSlovakia.

SeeTELpg8

BY JANALIPTKOVSpectator staff

Telecomfirmslike toattractheavymobileusers. Photo:TASR

Regulation: Elixir or poison?

TWO of Slovakias mobile operators com-plain that government regulation is toblame for their lower revenues and poorerfinancial results. But the most recent op-erator to arrive in Slovakiasrelativelysat-

uratedmobile market believes thatappro-priate government regulation is a precon-dition for a healthy, competitive environ-ment. Andan experton thetelecoms mar-ketsays governmentregulation of themo-bile business is important because the

market cannot always adequately affectpricesandserviceconditions.

Regulation would probably notplease any industrial branch, Alojz

Vlko, a telecom market expert, told TheSlovak Spectator. Thus, we should not

wonderaboutthe rhetoric ofmobileoper-ators.Itis logical forthemtonameregula-tion of prices for services as the cause be-hind their drop in revenues, because

without it [regulation] the creation ofprices mightbe freer and operatorsmightaskmorefortheirservices.

Thetelecommunicationssectorexper-ienced several waves of national andEuropean regulation governing intercon-

nection fees, the fees paid when makingcalls from one operators network to an-other network, as well as roaming prices

whenawayfromonesownnetwork.Vlko views supervision by national

and European regulatory agencies to be

important in mobile communications,saying competition is able to affect pricesonly to a limited extent.

International roaming might serveas an example, Vlko said, noting that

before European regulation, prices for in-ternational roaming were incomparablyhigher than prices for national calls eventhough the character of both services

was the same. Even under threat of reg-ulation, the operators were unable toreach an agreement [among themselves]at the wholesale level to make callingfrom abroad cheaper. Only regulationhelped.

Orange Slovensko, the mobile operat-

or which currently has the largest number of active customers in Slovakia, blamed regulation for almost all of thedrop inrevenues itreportedlast year.

SeeREGpg9

BYJANALIPTKOVSpectatorstaff

6

INSURANCE

Next issue:BUSINESS FOCUS

TELECOMMUNICATIONS

Mobile operators aredivided over the

efficacy of regulation

Three majoroperators plan

investments

for 2011

April18 24, 2011

Thealternative developmentof Slovakia'stelecomsmarket

Cutting energy usein telecoms


7/12

Alternativemodel for third operatorSLOVAKIASsmallest mobileoperator, Telefnica O2 Slov-akia, is sticking to a model

wherebyits servicesdifferfromthe twootheroperat-ors,SlovakTelekom, whichprovidesmobile servicesun-derits T-Mobilebrand,andOrangeSlovensko. Thesetwooffersubsidisedmobiledevicesto clientswho signafixed-term contract for aspecific package of services.O2,in contrast,does notof-

fer suchsubsidiseddevices.It confirmed its alternat-

ive approach with a newproduct introduced in early

April. This offers clients theopportunity to select fromseveral levels of a so-called

wallet and then use this topay for the services they ac-tually use, meaning there isno package of pre-definedservices which the customermuststickto.


A slightly different path

COMPARED to other Europeancountries, development oftelecom businesses in Slovakiatook a different route becauseliberalisation here came laterthan elsewhere. Nevertheless,themarketfounditsownpath.The Slovak Spectator spokewith Peter Maj, the chief ex-ecutive officer of Slovanet, oneof the bigger alternative tele-com operators in Slovakia,about the telecoms market, itsconsolidation, and the chal-lengesitcurrentlyfaces.

The Slovak Spectator (TSS):What are the greatest chal-lenges the telecommunica-

tions sector faces today? Doimpacts from the global eco-nomic downturn continue toaffect the sector and particu-larly alternative telecommu-nicationsoperators?

Peter Maj (PM): Thebiggest challenges facing thetelecommunications sector, atleast in Slovakia, are incess-antly decreasing prices andgrowing requirements on theservices provided. These twothingsare abit incontradictionbecause when you want to en-hance the quality of telecom-

munications services or theirparametersitisdifficulttodoso

without investments. In gen-eral, prices for telecoms ser-

vices have been decreasing forthe last seven or eight years in

Slovakia. In terms of the resid-ential segment, this is becausepurchasing powerhere isnot asstrong as in other EU countriesand when telecommunicationsoperators want to sell a biggeramount of services they de-crease their prices. In the seg-ment ofbusiness clients,pricesare decreasing too, as theformerly monopolised markethas become de-monopolisedover thelast12yearsandpriceshavedecreased dueto competi-tion. I seethe biggestchallengein finding enough funds for in-

vestments to make servicesbetter at the same price levelSlovakia is currently at, whichisoneofthelowestinEurope.

Withregardsto thecrisis,Isee two levels of impacts on

corporate and residential cli-ents. While business clientscame a year ago with higherpressure for a reduction in thescope of services and alsoprices, the demand for servicesin the residential segment hasnot decreased. But what has

been visible in the residentialarea is that price has becomethe number one criterion. Thismeans that when a householdchanges its operator, 60 to 80percent do so because of price.Payment discipline also

worsenedinbothsegments.

Nevertheless, the telecomssector has been hit relativelylittle by the crisis from the viewpoint of demand becausethese areessential servicesand,

forexample,ajobseekerneedsatelephone and access to the in-ternet to find a job. The crisisrather affectedadditional high-er value added services. Herethedeclinewasquitestrong.

TSS:InrecentyearstheSlovaktelecoms market has consol-idatedsignificantly. Whatarethereasonsbehindthis?

PM: Most economic sectorsin Slovakia have been undergo-ing consolidation, in general.Beginningeightto10yearsafterthe fall of the communist re-gime in 1989 a number of newcompanies emerged. Local orforeign investors and privateequity groups started to buy

them and then sold them tostrategic investors. This is acommonprocessthattookplacein each society transformingfrom a post-communist stateinto a democratic country witha market-driveneconomy. Thisisone ofthe influences I seebe-hind the consolidation process.The reason why consolidationin the telecoms business hasbeena bitstrongeris that doingbusiness in this sector is finan-ciallyverydemanding.

SeePMpg9

BY JANALIPTKOVSpectator staff

Peter Maj,CEOof Slovanet Photo:Courtesy ofSlovanet

7BUSINESS FOCUS

Licence extension will be not free

MOBILE operatorsOrangeSlovenskoand T-Mobile

(Slovak Telekom) willnowhave topay toextend theirGSMlicencesfollowinga de-cisionby parliamenton April5,madevia anexpedited le-gislativeprocedure,toamendthe ElectronicCom-municationsAct. The changemeansthat the nationalreg-ulator, theTelecommunica-tionsOffice,willset andcol-lectfeesforextensionof mo-

bileoperators licences to usespecific frequencies.The of-ficeshoulddo soafterpublicconsultations thatcitizensandexperts can comment on,the SITAnewswirewrote.

The licencescurrentlyusedby Orange Slovensko

andT-Mobilewilllapse onAugust31, 2011. Thetwo op-eratorseachpaidUS$18mil-lion forthelicences back inthe1990s,according to theSmedaily.

T-Mobileand Orange saidtheyregardthe amendmentashaving clarifiedthe exist-inglegislationandhope theregulatorwill setthe feestocorrespondwiththe situ-ationin themarket.Beforetheamendmentwasadop-ted,Orangeindicated thatitwould considerup to5mil-lion fora 15-year licence tobereasonalbe, Smewrote.

FOCUSshorts

30553

April 18 24, 2011


8/12

TEL: Data transfer volumes rise steeplyContinuedfrompg6

The most recent entrant tothe Slovak market, TelefnicaO2 Slovakia which started itscommercial operation in Feb-ruary 2007, said it extended its

customer base last year andpenetrated into new customermarkets. Because Slovakiasmobile market is nearly com-pletely saturated, Telefnicahad almost no other choice butto seek to capture customersfrom other companies. Theoverall penetration rate of SIMcardsin the Slovak market roseby 6.2 percentage points overthe course of 2010 to reach 111percent attheend oftheyear.

Last year clients trans-ferred almost 142,000 tele-phone numbers from compet-itors to O2, Ren Park,spokesperson of Telefnica O2Slovakia, told The Slovak Spec-tator. The total year-on-year

increase of O2s client baseamounted to 59.2 percent overa singleyear,toover880,000.

O2s revenues rose by 50.5percent to111.7 million.

Futuredevelopments

Market watchers forecaststronger interest in broadbandinternet and data services and,as was forecast at the worldmobile congress held in earlyFebruary in Barcelona, highersales of smart phones and tab-let computers.

It is possible to expectthat operators will massivelysell these devices and thatthey will also have to offer ser-

vices adequate for thesedevices, Alojz Vlko, a tele-coms market watcher, told

The Slovak Spectator, addingthat consumers can also ex-pect, for example, bigger andcheaper data packages and

better roaming offers for thoseleaving the country for holi-daysor othertravel.

Hanker expects additionaldecreases in prices for accessto the internet, though only

very gradually, and a more in-tense focus on increasingspeeds. Vlko added that tele-com operators are more fo-cused now on providing dataservices for mobiles and otherdevices.

The volume of data trans-ferred via mobile networks isrising steeply and this trend

will certainly not cease thisyear, Vlko said, adding thatbecause O2,as thelast operatorin Slovakia, will launch its 3Gnetwork later this year themarket may also see more sig-nificant confrontations onprice.

Vlko also noted that tar-geting specific groups of usersis very rare in Slovakia, listingstudents as an example, andpredicting that there is furtheropportunity here. He also ex-pects operators will prepareproducts clustering mobile

and fixed-line telephony, mo-bileand fixeddata services andtelevision, the so-called triple-playand quad-playpackages.

Operators may fight forclients also through suchcomprehensive packages with

better prices,Vlko said.Hanker agreed with thatassessment, pointing out thatcurrently discounts for com-

binations of mobile productsand especially for combina-tions of mobile and fixed-lineservices are relatively rare ordonotexistatall.

Hanker and Vlko do notexpect any swift launch of thenewestgenerationLTE techno-logy in Slovakia, with Hankersaying speeds provided by thecurrent 3G networks are highenough for normal as well ashigher-level usage in Slovakia.

Since all three mobile op-erators have announced in-

vestments into HSPA+ techno-

logy, we can assume that wewillhave towaitsome time forthe launch of LTE, Vlko said,

whileaddingthat thatlicencesand division of frequenciesmustbe resolved first.

Telefnica O2 Slovakia ex-pects that additional custom-ers will switch to its servicesand Park noted that thelaunch of its 3G network inJune will be the companys

biggest investment, addingthat O2s ambition is to coveras much as 33 percent of thepopulation in 24 towns across

Slovakia with its 3G network.He also said that O2 hadentered the market segment ofsmall and medium-sized com-paniesandhad registered an11percent market share in Feb-ruaryof this year.

Slovak Telekom expectsstagnation as well as regulat-ory challenges to continue inthe Slovak telecoms marketthroughout 2011, accordingtoGargulk. ST sees opportun-ity for growth particularly inmarket segments such as di-gital TV, mobile data servicesand ICT (information andtelecommunication techno-logies).

The Slovak governmenthas quietly signalled its planto sell its remaining shares inST and Gargulk expects thatthe government will com-municate in this regard withS Ts maj or ity owner,Deutsche Telekom.

Orange expects 2011 tobring developments similarto 2010.

The influences of directas well as indirect price regu-lation will continue, whichcreate a need to motivate cli-ents to use telecommunica-tions services in an increas-ingscope,said Tth.

Last year Orange invested71 million in new technolo-gies andintoitsnetwork,andplans to increase its invest-ments by about 40 percentthisyear.

8 BUSINESS FOCUS

Cutting energy use in telecoms

SMART 2020,a global report

on informationand commu-nications technologies(ICT)publishedin 2008,foundthatthecarbon footprintof ICTmakesup 2 percent ofallglobal greenhousegasemis-sionsand that this volumewill almostdoubleby 2020.Butsince theICTsectorisableto monitor andoptimiseusageof energy,ICT couldsave15 percentof globalemissionsin 2020,the reportsuggested. Thiscouldbeachievedby smartmotor sys-tems,smart logistics,smartbuildings andsmart grids;thearea of telecommunica-tionsinfrastructureenjoys aspecial position, it said.

Ourclients mobile op-erators,consume asmuch as85percentof their energyneeds on operationof theircommunicationsnetworks,said ubomroka,the dir-ector ofthe SlovakbranchofNokiaSiemens Networks,ata press conference inearly

April.Hepointedout that en-

ergymakesup a significantportion of theoperatingcostsof providersof com-municationsservices.Whileindevelopedmarkets energy

makesup to10 percent ofop-

erating costs,in developingmarkets this canrisetobetween15 and30 percent.

okasaid hebelievesthatmodernsolutionsandtechnologies canenablesig-nificant reductions inenergyconsumption.He listsfourmainways toreducetheen-ergyconsumptionof basetransceiverstations(BTS):byusing energy-savvyproducts;by minimisingthenumber of stations thanks tobetter coverageand highercapacity;byminimisingtheneedfor airconditioning;andby usingsoftware thatenablesenergyusewhendemandin thegrid islow.

Hepredictedthat suchmeasuresmay bringreduc-tionsin theenergyintensityof providersof telecommu-nicationsservices ofup to70percent.

Accordingto oka, newtechnologiesalreadyenableconstructionof stations in-dependentfromthegridwhose electricityneeds canbemet by localrenewablesources,for example solarorwind energy.


FOCUSshort

30554

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9/12

REG: Expect moreContinuedfrompg 6

Slovak Telekom, whichprovides mobile servicesun-deritsT-Mobilebrand,is also

notpleasedwith regulationsadvancedby nationalandEuropean authorities.Onone sideconstant

investmentsintonetworksandnewmodern technolo-gieshave beenexpectedfrommobileoperators buttheoperators aresimultan-eouslymoreandmorelim-itedin creationof pricesstemmingfrom traditionalmarketmechanismsoperat-ingin fully competitivemarkets,AndrejGargulk,thespokespersonfor SlovakTelekom(ST), toldThe Slov-ak Spectator.

Vlko concededthat notall regulatoryinterventions

turn outto bepositive.Ifthey [interventions]

reduce themargin inappro-priately,they mayaffect [acompanys] investmentactivity,which inthe endisa disadvantage,especiallytotheclient,Vlko said.

Themost recententrantintothe Slovakmarket,TelefnicaO2 Slovakia,

which begancommercialop-eration in February2007, be-lievesthat regulationhasimprovedthe environmentin thetelecommunicationsmarket.

Wemaintainthat thetask ofregulationis tosecureequal conditions for each

playerin themarketso thatthepreconditionof a healthycompetitive environmentismet,Ren Park,TelefnicaO2 Slovakiasspokesman,toldThe SlovakSpectator.Themarket environment ofthetelecomssegmenthasimprovedsignificantlyinSlovakiaoverthe last few

yearsexactlybecause ofregulation.

ParksaidthatwhenO2entered theSlovak market,thetelecomssector waslag-gingbehindother developedEuropeanmarkets in manyareas,specifyingthat it took25daysto migrate a tele-phonenumberfromone op-

eratorto another andthatterminationfees wereamongthe highest inthe EU.

Accordingto Park,O2 be-lievesthat actionsbySlovakiasregulator, the

TelecommunicationsOffice,helpedto pushdownter-minationfeesto thelevel indevelopedEuropeanmarketsandtocut theperiodre-

quired for transferringaphonenumberto fivedays,aswellas reducingthefeesassociatedwithdoing so.

Intheendit wasSlovakusersof telecommunicationsservices whoprofitedfromtheregulation, saidPark,adding thatthis applied notonlyto O2scustomers butthoseof itscompetitors whoalsobenefittedfromreducedpricesand morelively com-petition.

Moreregulationinthe future?

The TelecommunicationsOfficeannouncedin late

Decemberthatone ofitsgoalsfor 2011 isto reducein-terconnectionfees for allthreemobileoperatorsinSlovakia.It also will seek toreduce thetime for transfer-ringones telephonenumbertoa newoperator fromfivedays tojustone.

Moreregulationmightalsocome fromthe EuropeanCommission: it indicatedasearlyas lastJune itsdissatis-faction withcompetition

within themobile market,eventhoughroamingpriceshavefallen somewhat.

Thefirst EC regulationsconcerningroamingprices

wereintroducedin 2007to

ensure thatmobilephoneuserswouldpay similarroaming tariffsacrosstheEU.In July2009,theEC ad-optedrevisedrules thatregu-latedroamingpricesfurther,requiringthat by July2011themaximumroamingcharges,by default, wouldbe35centsperminutefor callsmade from abroadand11centsfor callsreceivedwhileabroad. Theroamingrulesadoptedin 2009will applyuntilthe endof June 2012.

TheECis preparinga fullreviewof its roamingrulestoassess theextentto whichtheobjectiveshavebeenreachedandwhether com-

petitionis workingforroamingservices,statesanECmediarelease fromFeb-ruary, noting thatits reviewshould be completedby June30, 2011.

PM: Broadband internet in sharp focusContinuedfrompg7

At first it arrives as a mar-vellous business but later youneed more and more funds forinvestments, which comefrom banks or investors. And

onlybigplayersgetthefunds.Moreover, in the telecombusiness there is one special way through which the statespurs consolidation since tele-com companies are using lim-ited resources such as fre-quencies, ownership rights tolay cables, assigning of tele-phonenumbersand soon, andtheir allocation is decided atthe state and political level.This means that the telecom

business is not completely in-dependent from the state.Consolidation is almost com-plete in the business clientsegment. There are about fivesignificant players far aheadofthe others and here I do not

expect any big changes in theforeseeable future. In the res-identialsegmentthere are alsoabout four or five significantplayers but this group is notidentical with those in the

businesssegment alongwithabout 150 to 200 local pro-

viders. Here the opportunityfor further consolidation ismuch larger, maybe even forthenext10years.

TSS:Slovanethasbeenanact-ive player in the consolida-tion process. What reasonshave driven this process

withinSlovanet?PM: During the last few

years we have acquired about

six local operators in varioustowns. We are continuing thisprocess as far as our invest-ment possibilities allow. Re-cent ly we a cq ui red M-Elektronik, a local provider ofcable TV service with almost10,000clients.ButIhavetosaythat due to the crisis we havenot been able to follow our de-

velopment plan since 2008 be-cause of worse access to fundsfor acquisitions. The situationhas now improved, but condi-tions are far from those that

were present here three yearsago.

The driving force behindacquisitions by Slovanet has

been to obtain infrastructure.

We can rent infrastructurefrom the former dominanttelecom operator, SlovakTelekom,butthetermsitoffersare so disadvantageous to usthat we decided to create ourown infrastructure to provideservices to households. Be-cause building a brand newnetwork would requireenormous investments withtoo-long terms of return, buy-ing existing networks along

with their clients eventhough these lines are not inperfect technical condition proved to us to be a sensible

way.Afterthe acquisitions,weare able to enhance these linesand continue selling services

provided on them to house-holds. Through our acquisi-tions we have achieved theneeded critical massof clients,

which in our case means40,000-50,000 clients, so that

theresidential segment gener-atesaprofitforus,meaningweare ableto coverinfrastructureinvestments, costs of opera-tion,andso forth from ourrev-enues.

Our ambition is to contin-

ue with this approach and ac-quire other local providers.Since penetration of the inter-net is still low in Slovakia, weseespaceforgrowthinthisres-identialsegment.

TSS:What are alternativeop-erators conditions and posi-tioninSlovakia?

PM: It is not worth cryingover spilled milk. The opera-tion of the telecom regulatorhas been poor for 15 years andthis has not improved eventhough we constantly point itout.Liberalisingthemarketforfixed-line voice telephone ser-

vice in Slovakia, enabling in-terconnection between voice

networks of the dominant op-eratorandotheroperators,wasprobably the last to be accom-plished within the EU. Thisgave the dominant operatortime to get prepared, which is

what it did, and it managed tokeep its clients. In countries

which liberalised this marketearlier, about 30-40 percent ofclients switched to other oper-atorswhilein SlovakiaI estim-ate thisto have been15-20 per-cent.

The second fundamentalthingis howthe broadbandin-ternet market is regulated.This is the market of localmetallic lines. Here Slovakiahas taken a completely atypic-

al direction in the so-calledlocal loop unbundling, whichshould have been the secondstep of liberalisation. In fact,this step has not yet happenedin Slovakia. The referential of-fer, i.e. the terms under whichthe dominant operator leaseslocal loops to other providers,does not enable us to provideand sell services on them in a

waythatiseffectiveenoughforus. Actually, because no localloop unbundling happened inSlovakia liberalisation of themarket for access to the inter-net happened in the way that150 players emerged who builttheirownnetworks,eitherWi-Fi, optic, optic-metallic,coaxi-

al and so on. This is why themarket is so atomised andneeds consolidation. As a con-sequence Slovak Telekomholdsthedominantpositioninfixed-line voice service as wellas in broadband internet. InthelatterIestimateitat92per-cent in the residential seg-ment. On the other hand, themarkethasfounditsownway.

Alternative networks havebeen built and already a signi-ficantnumberofclientsareus-ing them. And I expect thatthisshare willgrow. Of course,this also has some disadvant-ages because in many placesmultiple cable lines have beenlaidandthequalitymighthave

beenhigher if wehad hadonlyone infrastructure in each loc-ation.

Even though there areplenty of small, partial prob-lems, I do not expect the tele-

communication regulator todo something today to benefitalternative operators. Form-ally, it has set conditions foroperation of the dominant, as

well as alternative operators, but these are not improving

the conditions for operation ofalternativeoperators. Theyareunacceptable for us; they pre-

vent us from using regulatedprices for provision of profit-able services and for develop-mentofouroperation.

In Slovakia I see a conflictof interest as the state is theowner of a 49-percent stake inSlovak Telekom and simultan-eously is the founder of theregulator. This means that thestate on one hand receives di-

vidends[from Slovak Telekom]andontheotherhanditshouldregulate the companysprofitsor revenues. The only solutionI see is for the state to sell itsremaining stake in Slovak

Telekom.

TSS: Does the position of analternative operator offerany advantages over thedominantoperator?

PM: The word alternativehas been used less often overthelastoneortwoyears.Basic-ally we are a telecommunica-tions operator like any otherandwe canprovideanyservicein the same scope as the dom-inant providers in Slovakia,Deutsche Telekom and FranceTelecom, except for mobileservices but even this is pos-sibleto solvevia virtual mobileoperators.Themainstrategyofa so-calledalternativeprovider

is to offer services in a faster,more effective and more flex-ibleway,withbettercareforitsclients.

An alternative or a smalleroperator is more flexible andcan choose from more techno-logies as it is not as bound tothose into which it has inves-ted. We use this advantageheavily we use technologies

based on wireless, optic, andmetallic networks. Basically

wecanoffertheclientthemosteffective service for a reason-ableprice. Themost importantadvantageis the quality of ser-

vices.Alternativeprovidersareusuallysmallercompaniesandthustheyareabletoprepareef-

fective and build-to-suit solu-tions for clients. In terms ofbusiness clients, bigger com-paniesusuallyhave morefixedsettings and are not able toprovideabuild-to-suitsolutionfor each client. In the residen-tial segment, an alternativeproviderhasmoreflexibilityincreation of prices and it canchange a product faster. Qual-ity is another important cri-terion. If we do not have ahigherqualityofservices,acli-ent would have no reason toswitchproviders.

TSS: Slovanet launched atelecommunications devel-opment and research project

in2010.Can you tellus moreaboutit?PM: This is a three-year

project focusing on primary,notapplied,researchandwedoit incooperation withthe Min-

istryof Education. It is focusedon research of algorithms foridentificationofspamandsim-ilar unwanted electronic mailand it is called Spamia. Its aimistomakeheadwayinresearchand development in this field

at the Slovak level as well as atthe global level and to movethese algorithms forward. Welaunched a special workplacein Bansk Bystrica where ourresearch team is based. As wealso provide e-mail services,

wecanprovide a huge numberof e-mails for testing of thesealgorithms so that there is notonly a purely academic look atthis issue. I am glad that wehave launched this project asthere are only a few real inter-connections between businessandacademiainSlovakia.

Apart from anti-spamtechnologies we arealso activein developing solutions to pro-tect children from unwanted

content on the internet. Wewanttobeinnovative.In general, development is

inevitable for an operator ofour size because we cannot af-ford to buy all the software weneed. Actually, the only signi-ficant software we have

bought is economic account-ingsoftware.The rest hasbeendeveloped by our people eitheras brand-new programmes orapplications derived from freesoftwareorcodes.

TSS: One of your surveys ofclient behaviour indicatedthat Slovaks want to paythelowest monthly fees andtend to subscribe for longer

periods. What do you thinkthis says about Slovaks asconsumers?

PM: I am sure that othertelecom operators have cometo the same findings. Thisphenomenon, started by mo-

bileoperators, is verystronginSlovakia and I think that it isstronger than, for example, intheCzechRepublicorAustria.

TSS: Development is veryfast in telecommunications.

Where might it be withinfiveyears?

PM: If I knew this I wouldmakealotofmoneyonit.Alas,I am not such a visionary. But

wecanlook atsomecountries,

for example the USA andCanada or Western Europewhere the development is twotothreeyearsaheadofSlovakiato get a hint at what direction

we might be going. But what Iam completely sure of is thatthere will be increasing de-mand for broadband internetaccess. Moreover, TVswill also

be used for services currentlyreceived via a PC, for examplesharing photos, videos, onlinegames, social networks, etc.

Access to a fixedbroadbandin-ternet line will become a ne-cessity for every household.Mobile internet will be a sec-ondaryoption.

The segment of business

clients is conservative and themigration to IP telephony isalmost complete here. I seemore focus on security andhere a lot of work could bedone.

9BUSINESS FOCUS

Moreregulationofmobiletariffsmay come. Photo:Sme

April 18 24, 2011


10/12

DEAL: Watchdog calls for new tenderContinuedfrompg1

Political observers noted,however, that questions of impro-priety surrounding the contracthave put the SDK in an unfortu-nate position and are urging theparty to leave no questions un-answered.Fair-Play Alliance,a polit-ical ethics watchdog, said that thebest way to deal with the contro-versy would be to cancel the con-tract and start the procurement pro-cessagain withmore transparency.

Threedaysafter Fico madehis al-legations Radiov requested thedirector of the Tax Directorate to ac-cept new bids for office space inKoiceandadded that ifa cheaper of-fer meeting all requirements issubmitted the current lease should

be cancelled. After meetingRadiov, Mikulk said he saw noreason to resign because he said allsteps taken by the tax authoritywere legal. He also stated that rent-ing the building from urkas firmwould save the state about 3.5 mil-lionin upcomingyears.

Zuzana Wienk, the director ofFair-Play Alliance, said thatwhenever a state contract is signedwitha firm orperson closeto a polit-icalparty, thedeal evokes questions.

This is a fact that experiencedpoliticians should know, Wienktold The Slovak Spectator. Thus,they should do everything to avoidsuspicions and be able to prove thatthe [political] ties in no way affectedtheir decisions.

Wienk said the Tax Directorateshould seek the best and most ad-vantageous offer while being able toprovethat it went through a fairandtransparent process. She added thatbased on the information availablethus far, the tax office has notshown that it actually searched forthemost advantageous offer.

The chairman of SDK, MikulDzurinda, defended the contract, asquoted by the Sme daily, by asking:Should a member of SDK be han-dicapped or discriminated against?Sme also quoted Radiov as saying:Do you want to say that the 5,000members of SDK cannot apply foranything in thissociety?

Conflictingversions

Fico said on April 11 that his gov-ernment had been seeking space fortax offices in Koice and that via a

tender it had found a better offer andthat an agreement on a future rental

was signed with VSH Developmentin the spring of 2010. Fico added thatsoon after the new government tookpower VSH Development was sent aletter notifying it that the state didnot have the necessary funds to con-summate thelease. Fico chargedthatMikulk then signed the deal withurkas firm.

What did they think; thatnobody would ever find out? Ficoasked, as quoted by the TASR news-

wire, adding that Miklo must havebeen aware of what was happeningand then alleging that 20 percent ofthe lease amount would end up inSDKsaccounts.

Mikulk denied Ficos allega-tions and stated that the buildingchosenby hismanagementhad beenconsidered as early as in 2008 andthat a government committee hadselected the offer made by Nitra In-

vest as the most advantageous atthattime.

Regardless of the results of thiscommittee [decision] the manage-ment of the Tax Directorate in 2010optedfor a much moreexpensiveop-tion and signed an obligation with

VSH Development, Mikulk statedon April 11, as quoted by the SITAnewswire.

But Sme reported that it did notfind any evidence that Nitra Investhad submitted any official offer inthepastandthatin March2008NitraInvest did not even own the buildingin question, which is on RozvojovStreetin Koice.

Wienk told The Slovak Spectatorthat the information published bySme seems to indicate that Mikulkdid not tell the truth when heclaimed that Nitra Invest had beeninvolvedin the competitionin 2008.

It is a very unpleasant issue forthe SDK, Grigorij Mesenikov,president of the Institute for Public

Affairs, told The Slovak Spectator,adding, however, that Fico shouldhave put some facts on the table tosupport his charge that the SDK

would benefit from the rentalagreement. Politically it will beused against the SDK and Smer willkeep repeating that this is a story ofcronyism, though in its scale it is in-comparably smaller than what Fico

washandlingunder hisrule.Mesenikov said whether the is-

sue will cause harm to the party willdepend on how the SDK explains

the controversy to its supporters andto the media as well what steps ittakes to answer the questions thathavebeen raised.

It will be important to come up with a solution, which means notpushing ones head into the sand butunderstandably explaining the caseand if any wrongdoing emerges,then fixing it, Mesenikov told TheSlovak Spectator.

Fair-Play Alliance suggested thatthe best way to proceed in govern-ment contracts such as this one is topublicly disclose any potential con-flicts of interest on the part of a bid-der and the contracting public offi-cials and to take appropriate meas-ures to ensure that the process isfullytransparent.

Wienk recommended that theTax Directorate cancel the contractand go through a public bidding pro-cess once again,but this time bydo-ingit right.

Ofcourse, thefirm owned byMrurka has the right to bid as well,

Wienk stated. However, it must bedone in a way that the procurer isable to responsibly avoid suspicionsthat the [contract] order went to the[business of the] party member only

because it is close to the party andthatit wasdisadvantageous.

Shellfirmin Cyprus?

On April 12 urka rejectedFicos charges of party cronyismand said that the Tax Directoratehad chosen the best offer, statingthat the building that was leasedhas air-conditioning and large of-fices and had been completely ren-ovated.

The ownership structure of Ni-tra Invest, entered into the SlovakTrade Registry on July 6, 2004, hasalso been questioned by the media.

According to the registry the firm isco-owned by urka and a company

based in Limassol, Cyprus with thenameTPE Holding I Limited.

In response to the reports thatNitra Invest is co-owned by a Cypri-ot shell company, Radiov presen-ted a document on April 13 from theMinistry of Economy and Tourismof Cyprus which she said showedthatthereare noSlovaksinvolved inTPEHoldingI Limited,SITA wrote.

In the past urka was one ofthefounders of theTA3 news televi-sion channel but sold his shares in2000 to Martin Lengyel, formerspokesman for Dzurinda when he

was primeminister.On April 13, Sme reported that

the first business Nitra Invest at-

tracted after its establishment in2004 came from a SDK member,Ferdinand Vtek, the former mayorof Nitra, who tasked urkas firmwith buying property for the NitraSever industrial park. Sme addedthat it found no evidence thatVtekhad pickedurkas firm viaatender.

Milan Burda, a Smer MP, sub-sequently charged that Nitra In-vest had sold the property it ac-quired for the industrial park to investors for a much higher pricethan its purchase price. Burdaopined that urka must haveearned between 17 million and33 million by handling the indus-trialpark property, Sme wrote.

urka rejected these accusa-tions also, stating that anyonecould have bought those landplots but no one else had venturedtodoso.

He also stated that no politicalcontacts were involved in Nitra In-vest getting thebusiness buthe didnot deny having cooperated on leg-al affairs with ARON Consulting, afirm which is co-owned byEleonra Valentov, the wife ofGabriel Palacka, the SDKs formertreasurer, whose name has beenlinked to a number of questionableSDKfinancialtransactions datingback to his resignation from cabin-et more than a decade ago, TASRreported.

The three other parties in thegoverning coalition said they ex-pect a thorough explanation of theKoiceofficelease.

The leader of Freedom andSolidarity (SaS), Richard Sulk,asked that the prime minister takethe same approach to the SDK asshe took towards his party whenquestions emerged last year aboutthe so-called Liberal House, an of-fice building which SaS intended torent to its MPs, who would thenhave used their state expense al-lowance topay theirofficerent.

I do not see that there is anydirect parallel in the sense that themoney would be used for activitieso f a p ol itica l pa rty , sa idMesenikov. The difference is thatthe Liberal House would have beena project from which a politicalparty, SaS, would have profited.Even though it was legal, the prob-lem was that state funds wouldhave been used to support a politic-al party.

MiroslavMikulkofSlovakia's TaxDirectorate. Photo:Sme

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NEWS10 April 18 24, 2011


11/12

Well-rooted musicianscan stretch their styles

NORTHERN Indian classicalmusic is a very specific genrethat is notwidespreadeveninits home country as it is quitedifficultto learn andrequires aspecificapproachand unusualinstruments. But musicians

playing this kind of music of-ten join together with otherperformers to stretch the lim-its of the music world, exper-imenting with new combina-tions and rhythms, findingnew audiences and bringingmore people to appreciate In-dian classical music. InMarch, members of the Ab-hijitBanerjeeTrio acceptedaninvitation from Slovak jazzdrummerMartin Valihoraandthe Shiraz agency to particip-atein theOneDay Jazz Festiv-alin Bratislava.

The festival is the spir-itual child of Valihora, agraduate of Berklee College ofMusic in Boston, USA, who

h as p la ye d wi th ma nyrenowned world musiciansand recently became evenmore popular performingalong with the legendary Col-legium Musicum formationand the Martin Chodr Band.At past festivals Valihora hasbrought musicians of variousgenres to perform with himandhis ever-changingMartinValihoraTrio. Thisyear he in-vited Gypsy Classic as theopening band as well as theIndian Abhijit Banerjee Trio.After the opening gig on

March22,the MartinValihoraTrio performed, followed bythe Indian musicians alone,culminating with a joint

crescendo fusing classical In-dian music with jazz, result-ing in a galvanising perform-ance interrupted with wildapplause and ending in astandingovation.

Theorganisers alsoofferedtwo screenings of a movieaboutthe Indian musical styleand two public discussions

with the musicians, one ofthem with members of theSlovak-Indian FriendshipClub, and added a concert inthe spa town of Pieany. Thetrio consists of Abhijit Baner-jee playing the tabla drum,BiswajitRoy Chowdhury play-ingthe sarode, anold classical

instrument,and Somnath Royplaying the ghatam, also anolder type of percussion in-strument. Each trio memberhas performed with well-known world musicians suchas Ravi Shankar, Trilok Gurtu,and Ry Cooder and each com-poses music, for movies as

well. The Slovak Spectatorasked them about their routesfromIndian classical musictoEuropean jazz and other mod-ern styles as well as abouttheirimpressionsof Slovakia.

The Slovak Spectator (TSS):How did you find the Slovakaudience?

Abhijit Banerjee (AB):

You are a musical nation,thats for sure. A Europeanaudience is not expected tounderstand everything. AnIndian audience,when listen-ing to Indian classical music,usually also expresses

Slovak Spectator 1715

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