jubljana, 26. April (STA) - "An important breakthrough was made in approaching the European Union, establishing real possibilities for signing the association agreement. Almost all EU member states expect this to happen in a very near future, believing EU did what it could, leaving Italy, which blocked the association agreement all along, to make the next move," Prime Minister Janez Drnovšek said in an interview for Delo's Saturday Supplement.***

        With regard to economy, premier Drnovšek confirmed macro-economic indicators were somewhat worse than in the last two years and below those planned. According to Drnovšek one of the key reasons for this lies in the decrease of economic growth or even recession in Western Europe, including Germany as Slovenia's main foreign trade partner. Other reasons include delayed consequences of over-estimated Tolar and the fact that the privatization reform has so far failed to gain ground. Prime Minister Drnovšek said the government was seriously analyzing the situation, also regarding inflation which is somewhat higher than expected, having agreed on all possible measures to curb down inflation and keep it below last year's levels. The government has tightened anti-inflation policies, also seeking ways for lowering contribution rates. Another important issue is that of personal wages, said premier Drnovšek, adding the cabinet was likely to correct the planned GDP growth from the current 5 to 4 per cent. He also pointed out to politization in economy which creates bad reputation of Slovenia at foreign investors. "Practically every foreign investment is turned into a political issue," premier Drnovšek estimated.

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