In order to get an overview of the Slovak construction market, how would you describe the evolution of the construction industry over the past 10 years and its competitiveness as compared to the neighbouring and EU countries?
Concerning our professional level and the service quality, Slovak building companies are surely competitive. Over the past 10 years our civil engineering has distinctly advanced and developped, managing to succeed in various market environments especially in Germany and Czech republic. It can also fulfill requirements even from the most demanding investors in all areas of construction. However, the last development is not favourable in regard to Slovak building capacities exploitation since various protective precautions prevent free expansion of building companies abroad and investors are still missing on the domestic market. In comparison with the Czech construction sector, the current Slovak construction industry is in strong deficit. While in Czech republic 9 billion EURO ( ca. 300 billion CZK) is invested per annum, Slovakia builds only from investment of 1.6 billion EURO (70 billion SK), whereas population ratio of these countries is 2:1. Nevertheless, it is not the building industry to be concerned - it is economy and infrastructure development as well as fulfilling needs of this country's people. We need investments so much as live-giving blood. Lack of investments causes economy difficulties also among building companies, hence, the unemployment is growing. Moreover, strong foreign building corporations are entering our market, having no difficulties in fulfilling guaranty and other conditions from the financing institutions and banks. Such advantage is for our domestic building companies in most cases unreachable. Many of these domestic companies are then only in a position of cheap subcontractor, having troubles to survive. For investors, such situation is undoubtedly advantageous but not for Slovak companies because higher profit ratio flows abroad.
So, what is currently your philosophy and the strategy that your company must follow to adapt to such conditions?
ZIPP is a well performing building company. In the year 2001 we are expecting an annual turnover of 7 billion SK, which is about 1/10 of total civil engineering investments in Slovakia.
Does it represent a significant growth in comparison with 2000?
In the year 2000 our turnover was 4,5 billion SK,
the growth will therefore be ca. 2,5 billion SK.
Similar growth was also recorded in the previous
years, when in the year 1998 our turnover was only
1,8 billion SK. We are therefore successful company
and we recorded the strongest growth just during
the time of building recession, when many strong
Slovak companies went bankrupt or experienced extreme
difficulties (Priemstav Bratislava, Renos Bratislava,
Váhostav Žilina, Hydrostav Bratislava
etc.). I do not like presenting our filosophy and
strategy because very few people want to believe
it: our success is conditioned especially by hard,
professional and dedicated work, excellent organization
of all levels and endeavour to build with high quality
and in good pace in compliance with customer's expectations. |
And that is sincere since nobody could help us with tenders and construction for prominent foreign investors. We do not work almost at all for the state sector, we assert ourselves in tenders for authentic private companies, which clearly define their own requirements, based on which the tender is professionally evaluated. It would be good to mention some of our references on the Slovak constructional market: in the past we built huge industrial objects for a car maker Volkswagen in Bratislava, to which there is connected extensive car-industrial park, built in direction of an American company AIG/LINCOLN. Some other constructions that we carried out are connected to VW - French Plastic Omnia, American DURA Automotive, also German concern INA producing bearings. For INA we even built four objects in Slovakia. Also Japanese companies SONY, Panasonic and Matsushita Electronic trusted us when building their own objects in Slovakia. We were also successful with construction of many TESCO, Carrefour, Kaufland and POLUS hypermarkets. We have also demonstrated our skills when constructing bank buildings (tall building of National Bank of Slovakia, building of Prvá stavebná sporitelna).
To what extent do you consider EU programmes such as PHARE and ISPA as useful for small enterprises?
Support programs in form of non-returnable grants should have authorization in places where an economic subject cannot develop healthily and naturally. However, market objectivity is thus disturbed because someone receives the grant while the others one not. Inflexible bureaucratic system of various funds and their non-transparency are also a problem. I would not like my opinion to be understood as an ingratitude towards EU help. More effective support for us would also be advantageous bank loans and non-discriminating conditions of competitions, which would allow domestic companies get through the competitions objectively. The aim is to facilitate the well-functioning of the Slovak economy, the only thing that guarantees smooth membership of Slovakia in the EU. Fulfilling another pre-entering criteria is important but not crucial.
Note: World Investment News Ltd cannot be held responsible for the content of unedited transcriptions. |
