Brilliant concert in bratislava

The Danube region

Also this is the status of the Bratislava Paris fast rail connection


Paris - Bratislava by train and investments in Slovakia - updated


Foxconn (the company that makes the iphone for Apple) has just bought Sony's factory in Slovakia. Along with Samsung, this is making Slovakia a hotspot for the production of high quality electronics. It seems that after cars Giant electronics behemoths are setting up shop. It is intriguing that Foxconn is Chinese and yet it chooses to invest in Slovakia for its european investments.

In other news the transformation of Bratislava's transport and integration with 2 Ten-t rail corridors is about to begin mirroring the work Austria's rail started 60km away in Vienna. 

Here are some graphics and visualisations of the cutting edge infrastructure that is going to be built in Bratislava:

Disused station in Filialka...

to be replaced by

new filialka station (close to existing ursinyho tram stop)


Transportation links and proximity to other eurozone countries' markets seen as strategic reasons to invest in Slovakia by asian investors.

The South-Korean companies Kia and Samsung want to continue broadening their activities in Slovakia, South Korean Ambassador to Slovakia Seok-soong Seo told Economy Minister Lubomir Jahnatek at their meeting on Tuesday. “The ambassador informed the minister that the main Korean investors, Kia and Samsung, would continue expanding their activities in Slovakia in the coming years, so Slovakia is becoming a more and more important partner to South Korea,” the ministry said.

The Slovak Trade and Development Agency (SARIO) just announced that in total so far this year there are 85 investment projects meaning that about EUR 2.4billion to EUR 2.5 billion will come into Slovakia as investments.

The Director of the SARIO direct foreign investments division Andrea Chovancova informed that these investors are going to create more than 12,000 jobs in Slovakia.

The agency is currently working on 139 investment projects at present in total.

Why Bratislava? Why Slovakia?

The key reason behind all these long term bets in Slovakia's and Bratislava's success are not cost based anymore. Bratislava is significantly above the average in the EU, in terms of wealth and prices for most goods are comparable to London or Athens.

Bratislava's good connections with Austria and the rest of europe are to receive a further boost.

In a previous posting we discussed the new european transport networks. Part of the major and transformational projects headed by the EU is TEN-T that aspires to connect the different parts of europe together with transportation links to boost trade among other things.

Bratislava has been included in two of these project including  the one to Paris via Vienna and Stuttgard. This is obviously a transformational project for Bratislava as it links the city ever tighter to old-european capitals such as Vienna and Paris but it also makes Bratislava a part of the core european transport networks enhancing access in an environmentally sensitive way likely to survive the unsustainable boom in cheap filghts and their operators.

This is a relevant point as land transport is crucial if environmental concerns curb the affordability of cheap flights through which much of the eastern parts of the EU are linked to the older EU members. For example if one is stuck in Bucharest and wishes to travel to Frankfurt, the obvious choice would be to fly. However both because of the crisis but also because governments are increasing the taxes on polluting forms of travel, economic development via the airport is not a future-proof plan. This project therefore is vital for Bratislava as it can mean that the city becomes a hub for traffic from other regional capitals like Prague, Budapest etc. who would connect via Bratislava to the fast train network heading west. It could in fact become the replacement of the popular cheap flights. As natural a choice as taking the eurostar train between London and Paris.

Why is this more than just trains crossing borders
  1. Vienna's Sudbanhof station is already being demolished to make way for the infrastructure and new upgraded connection to Bratislava for the high speed trains. More on this big event Imagefolder, english (PDF, 1,65 MB)
  2. This project will be run using ERTMS ("European Rail Traffic Management System"). This is a major industrial project being implemented by Europe, a project which will serve to make rail transport safer and more competitive. One component of ERTMS, the European Train Control System (ETCS), guarantees a common standard that enables trains to cross national borders and enhances safety, speed, and cost competitiveness.

  3. Establishing an efficient trans-European transport network (TEN-T) is a key strategy for competitiveness and employment in Europe. If Europe is to fulfil its economic and social potential, it is essential to build the missing links and remove the bottlenecks in our EU transport infrastructure, as well as to ensure the sustainability of our transport networks into the future. Furthermore, it integrates environmental protection requirements with a view to promoting sustainable development.

  4. In view of the growth in traffic between Member States, expected to double by 2020, the investment required to complete and modernise a true trans-European network in the enlarged EU amounts to some € 500 billion from 2007 to 2020, out of which € 270 billion for the priority axis and projects.

  5. The speeds make this an alternative to planes. The train, TGV, already allows travellers to go from Paris to Reims in 45 minutes, and from Paris to Strasbourg, on the German border, in just two hours and 20 minutes. Under the old schedules, the trip to Strasbourg was nearly twice as long, at three hours and 50 minutes. TGV stands for "train a grande vitesse," which literally means high-speed train.

  6. The areas of Bratislava that are likely to be affected by all this are likely to be:
    Hlavna Stanica - Stare Mesto (Old Town)
    Filialka - Stare Mesto (Racianske Myto/Ursinyho)

Some visualisations of the Bratislava station for this end of the Paris Bratislava line now follow.

This is how the New Bratislava station and area will look

Potent stuff for the medium to long term future of this city.

and what about the trains that will run on the lines? The competing technologies are ICE from Germany or TGV from france

just see this (who needs planes...)

another one with some very happy frenchies :) well done!

BBC - Slovakia leads eurozone growth 

After the bailouts of Greece and Ireland, what are the prospects for the wider euro area?
Economic adviser Marie Diron examines the economic growth of eurozone countries.

Finance minister of Slovakia in english talking to Martin Wolf of the Financial Times interviewed

Is Estonia a sign of what’s to come for the euro?

The most significant EU-related development over the holidays was Estonia’s official entry into the eurozone on New Year’s Day, an event that is worth revisiting as the single currency prepares for what is likely to be another year of turmoil.

As Fredrik Erixon, director of the Brussels-based European Centre for International Political Economy, notes in a new “Obituary for the Estonian kroon”, it wasn’t too long ago that the Estonian government was being advised to drop its peg to the euro and let its currency float in order to save its economy from the ravages of the European debt crisis.

But Tallinn hung tough, and as we noted in an article last month, is now poised for gross domestic product growth that is the pride of the EU. According to forecasts by Eurostat, its 4.4 per cent 2011 real GDP growth would make it the best performer in the eurozone.

When I talked to Estonian President Toomas Hendrik Ilves last month, he recalled with hard-to-contain smugness the amount of pressure the country resisted to devalue during the early days of the euro crisis. “All three Baltic economies were in serious trouble, and all kinds of people said devalue, devalue, devalue,” he said.

In his paper, Erixon cites U.S.-baed economic giants like Paul Krugman and Nouriel Roubini as among those who advocated devaluation, but officials recently told me that the International Monetary Fund was also in the Baltic devaluation camp.

Ilves argued that devaluation, even for an export-reliant economy, wasn’t a panacea. It could have reduced the price of Estonian exports and relative labour costs, he said, but because Estonia imported so many of the components that go into its exports, the gains would be marginal.

In addition, Ilves argued, Estonian home mortgages and commercial loans were largely denominated in euros. So a devaluation would have sent borrowing costs skyrocketing.

“You decapitate all those who are doing the right thing,” he said. “You’re doing in the people who are the most successful, the most economically active, the people who are doing what you want them to be doing.”

Instead, Estonia cut budgets early and deeply. Does the fact that it is now poised for a rebound bode well for other recent takers of the austerity medicine, like Greece, Ireland, Spain and Portugal? Perhaps, but the Estonians also had a few things going for them that these others – particularly Portugal and Greece – do not: an open, competitive economy and crucially, in the view of Ilves, a reserve fund that carried them through the rough times.

“We resisted the populist pressure in the good years to go and spend the reserves, and we went into the recession with strong reserves which tides us over,” he said. Other Baltics, particularly Latvia, which was forced to rely on an international bailout, were less cautious.

As a new member of the eurozone, Ilves said Estonia was ready to play its part in helping the countries who have fared less well during the recent crisis. Even though it is small and comparatively poor, Ilves said his country is well aware of what shared responsibility means – as a new member of NATO, he noted, Estonia relies on the alliance’s defence guarantees, which allows Tallinn to save more than a bit on military spending.

But if there’s one thing the euro’s 17th member won’t tolerate, he said, it’s a lecture. Here, I’ll just let Ilves speak for himself:

The poorer countries that are fiscally responsible end up paying out richer countries that are not. This would be even ok except for the occasional arrogance and haughtiness of the rich countries towards us poor east Europeans. You can’t be haughty towards us because we’re not so rich, and at the same time [argue] it’s time to bail them out. Ultimately, let’s face it: Being richer wasn’t based on being more productive. It was based on bigger loans. Wealth based on loans is not wealth.

Estonia could prove an interesting new voice in the deabte over the single currency’s future.

“Wealth based on loans is not wealth.”

Loans are denominated in the official money units.

Owning wealth aside from official money units is the only way

by which societies have built up their storehouse of a wealth of things,

thereby advancing their kind from the beginning, and preventing the decapitation of all those who are doing the right thing.

Estonia will do well in the eurozone for two reasons: it is small, and it is still an emerging market. By definition, emerging markets have a lot of catch up to do, therefore they must invest more in capital goods to become a capital-intensive economy (than a labor-intensive economy). By using more machinery and other capital, while also making substantial infrastructure improvements, cost per productivity would sharply fall. This would make them even more competitive than mature economies like Germany or Finland.

In other words, as a nation developes, its currency should appreciate in value (like China's should). By Estonia joining the euro, it would put a cap any upward pressure on its own currency, the Kroon -- by joining the euro, it would be in a currency bloc with mature economies that do not see significant upward pressure on exchange rates. Estonia, then would be playing beggar-thy-neighbor policies. A good template for Estonia is Slovakia, which has seen its unit labor costs decline throughout the past decade in relation to Germany (Spain and others saw their unit labor costs rise against Germany). Such "competitive" Eastern economies in the euro would make it even harder for Spain or Greece to compete. Report Derek Tunnicliffe

One of the lessons that Estonia might offer to others countries (inside and outside the eurozone) is that of their "flat-rate" tax system. It was untried experiment when they took it on, but it appears to be a success, in both business and personal terms. But they also try to ensure a balanced governmental budget - another lesson for all but Germany?

Corruption trends

2 things
From the former boss at the
a radically different approach it seems to the new much more right-wing and virulently anti-euro economist

also chart of the day about corruption over the last 12 years
it seems that corruption is correlated with the business cycle, but not much else and it is improving slowly in central europe. In 20 years...

2011 predictions - how will the new year turn out?

Will the euro survive?
Yes. Despite the rolling wave of crises in peripheral European countries. It is probable that defaults will also be prevented in 2011. A less dramatic set of formal debt restructuring will happen in the PIIGSand Germany wants it to happen. As for a country leaving the Euro, that is more of 2012-13 question.

The euro will survive in the long run, and a north south divide may form, selecting countries that are able to live with Germany as direct trading partner and perhaps forming an ever closer union with it.

Will 2011 see banks fail?
2011 will be a year of bank runs in the anglosphere, banks in UK, Ireland, possibly Spain.

Will China’s bubble burst?
political risk may trigger a war involving north korea and poisoning the investments of many..

Will the US and its Nato allies start winning the war in Afghanistan?

Will social unrest worsen in Europe?

Most probably in the badly managed economies of the PIIGS. The utterly docile and passive public of the USA will continue to suffer silently a bit like an asian authoritarian regime, economic policy will stay the same, but the dangerous direction of US politics, with the Republicans continuing their transformation into a far right party, and the democrats continuing to be 2 parties in one. Europe's periphery may be smalshing lamposts but the rather silent rise of extreme politics in america with the tea party etc. will bring about surprising changes in the USA and not for the better,

The ongoing boom in germany will stabilise its neighbouring countries (including Slovakia), and bring about north/south divide in europe.

DANUBEBUS - A water bus will join Danube regions

IN THE NEAR future a new form of river transport called the Dunajbus will offer regular boat service on the Danube from Slovakia’s town of Šamorín to Hungary’s Rajka, on to Bratislava and Devín in Slovakia and ending in the Austrian town of Hainburg. The goal is to intensify cross-border contact and travel between people living along the Danube. The project has been green lighted by the EU operational programme Hungary-Slovakia, 2007-2013, and should boost cross-border tourism and commuting. The Trnava Region parliament discussed the project in mid October as it would be responsible for 5 percent of the total project costs of €122,850. Other partners are Bratislava Region, Hungary’s Győr-Moson-Sopron County, and regions in eastern Austria, the TASR newswire wrote.