EU Steel Summit Taking Place in Ljubljana

Ljubljana, 09 June

The umbrella organisation of the European steel industry, Eurofer, was kicking off a two-day conference aimed at reviewing current trends in the industry on Thursday in Ljubljana.

The summit of the European Confederation of Iron and Steel Industries (Eurofer) was attended by 90 general managers of leading steel companies from all around Europe.
The event iwas launched with a round table on tool and cutting steel, while participants were addressed by Slovenian Economics Minister Andrej Vizjak. The Eurofer general assembly and a plenary session were held on Friday.
One of the main topics of the talks was answering the challenges posed by the ever more imposing competition coming from China.
China has become the runaway leader in terms of steel production, accounting for 26% of all output in 2004. The EU was in second place with 18% of the output, followed by the Commonwealth of Independent States with 11% and the US with 9%.
China is also expected to be the main engine of growth this year, according to Eurofer forecasts. The organisation expects Chinese steel needs would increase by 14% this year, which will force it to become a net importer again.
Despite China's hunger for steel, the organisation believes that Chinese import growth will not be as extensive as in previous years because the country will itself increase capacity by over 10% by putting online new production facilities.
Playing host to the important meeting is the Slovenian Steel Group, which considers it a great recognition that it has been entrusted with staging the summit.
In an interview for the STA ahead of the meeting, the chairman of the Slovenian Steel Group said that Slovenia focuses primarily on the production of specialty steel, which is why world industry trends do not affect it as greatly as other countries.
According to Tibor Simonka, the year 2005 is expected to be just as good as 2004 in terms of operations for the Slovenia Steel Group. Last year, the group registered 30% growth in revenues.
The group should generate revenues of SIT 110bn (EUR 459m) this year, while profits should be twice that of last year, when they stood at around SIT 3bn (EUR 12.5m), Simonka said.
"The Slovenian Steel Group increased its output of cast steel by 7% in the first four months of this year, making it one of the three fastest growing steel companies in Europe," he said.
Simonka said the strong results last year have allowed the group to launch heavy investment into production capacity. "The extensive investment planned for the next five years should take us where we should have been years ago," Simonka told STA.
Moreover, he stressed that the planned privatisation of the group should have a positive impact on the development of the steel industry in Slovenia. Of course, this will depend on whether the privatisation will allow us to take advantage of investment quickly, he added.
"We may run into problems in development and thus become less competitive if the goal of the privatisation will be to obtain a short-term financial boost," Simonka warned.
The Eurofer association represents 95% of all the steel companies in Europe, employing over 300,000 people, producing over 200 million tonnes of steel annually and generating over EUR 130bn in sales revenues.
Economics Minister Favours Local Capital in Hydro Plant Project
Ljubljana, 09 June (STA) - The act on the hydro power project on the lower Sava is adopted, the license has been given out and a lot of money has already been invested, which is why it does not make sense to make changes now, Slovenia's economics minister said.
If changes were to be undertaken at this time, it would cause significant damage, Andrej Vizjak told Thursday's daily Delo. We can think about attracting foreign investors for projects that are currently on the drawing table, he added.
Answering Delo's question about Finance Minister Andrej Bajuk's inclination to see foreign investors take over the lower Sava project, Vizjak said it was good that discussions had been launched on foreign investment in energy projects.
The discussions had previously been initiated by the Holding Slovenske elektrarne (HSE) - Slovenia's biggest power producer - in plans for projects linked to energy sources Slovenia lacks, he told Delo.
However, Vizjak maintains that he does not know of Bajuk's proposal to give the licence for constructing five hydro-electric power stations on the lower Sava to foreign investors.
As for the loan that the HSE has sought from the European Investment Bank for one of the power stations on the lower Sava, which the Finance Ministry has failed to clear, Vizjak said: "It is true that this adds to the public debt, but I think that it makes sense to go into debt for projects that are expected to make returns."
Moreover, he said the HSE would not be privatised as a whole, but that companies making up the group could be privatised individually through fresh capital injections.
He also said the number of joint-venture projects in electricity production will be a crucial factor in deciding how dependent Slovenia will be on foreign natural gas in the future.
Moreover, the fate of the second bloc of the Nuclear Power Plant Krsko (NEK) will also depend on it. Slovenia should first ensure that a storage facility is built for NEK and that its life-span is extended, Vizjak told Delo.

EU Steel Summit Taking Place in Ljubljana

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