• 2002-04-18
DEBT RISING: Latvians are becoming increasingly late in paying their bills, according to a survey released this week by a leading debt collector. According to the survey of 300 businesses conducted by Creditreform, 60 percent of the bills paid are overdue. That's a 7 percent increase over last year. Payments are made an average of 18 days late, according to the survey. Payment for information technology services are the most chronically late, the report shows. Only 24 percent of bills for services like Internet access are paid on time. Fuel suppliers are the most likely to get paid on time. The increase in overdue payments are also causing companies to annually rethink their credit terms, according to the survey. (Baltic News Service)

ELCOTEQ LAYOFFS: Mobile telephone producer Elcoteq plans to lay off about 270 workers at its Tallinn plant, the company announced this week. The layoffs will include both permanent and temporary employees from management and production, according to a company statement. Many are on fixed-term contracts, according to the company. The company did not say when the layoffs would begin. Elcoteq currently employs 2,000 workers at its Tallin plant. The company laid off about 600 workers last year when it lost a contract to produce phones for Ericsson. The main reason for the layoffs are continued low demand in the mobile phone and communication network equipment markets. Elcoteq also announced layoffs in China and Mexico during the first quarter of 2002. The company employs about 7,700 employees around the world. The personnel cuts are part of a program started last year to adjust the company's operations, including personnel, to match projected orders. (BNS)

BACARDI LOOKS AT ESTONIA: Distiller Bacardi is seriously interested in producing vodka in Estonia, according to the Economic Affairs Ministry. Signe Ratso, deputy chancellor of the ministry, met with Bacardi officials on April 15. He said Bacardi, which is best known for its line of rum, is interested in creating a new brand of vodka. Bacardi has signed a preliminary agreement with the Estonian distiller Onistar for production, according to Ratso. Onistar spokesman Marko Kadanik confirmed that his company had been in talks with Bacardi but that no contracts on production had been signed. Bacardi began looking for a producer last year, Ratso said. (Baltic Business News)

COMMON ENERGY MARKET: Power regulators in the Baltic states hope to sign an agreement by June that would create a long-discussed common energy market policy, according to the head of Latvia's Public Services Regulatory Commission. Regulators from all three countries met in Riga on April 15 to prepare basic guidelines that mark the first step toward forming a common Baltic electricity market, Inna Steinbuka said. A common policy would open the Baltic market to more cooperation, she said. Lithuania's National Price and Energy Control Commission Chairman Vidmantas Jankauskas said that the development of a common energy market would eventually lead to more competition and lower prices. "Everyone will be able to choose where to buy cheaper after we open the market," said Jankauskas. He pointed to the Scandinavian energy market as a model for the Baltics. (BBN)

FERTILIZER DEAL: The Russian fertilizer company Evrochim will take over Lithuanian rival Lifosa, but the U.S. Cargill Group will continue to market Lifosa's production, a top Evrochim manager said on April 16. "On April 5 we signed an agreement with major shareholders of Lifosa to take over a controlling stake in the company," Evrochim Vice President Kiril Babajev told Agence France-Presse. The transaction should be concluded by the end of this week, he added. Babajev declined to specify the size and value of the stake in Lifosa to be purchased by Evrochim. "It is more than 50 percent, we shall announce all the details later," he said. Lifosa's shares were obtained from Cargill, Italy's Indutech and Lifosa's General Manager Danas Tvarijonavicius. Prior to the deal Cargill owned 24.85 percent of shares in Lifosa, Tvarijonavicius had 23.35 percent and Indutech held 8.3 percent. The Dutch group Participations Financiers had a 20.4-percent stake in Lifosa. Babajev said that under the agreement Cargill would retain the exclusive right for distribution of Lifosa products over the next five years. Evrochim plans to invest $5 million in Lifosa immediately after closing the transaction and also guarantee the supply of raw materials to the company. Lifosa's turnover shrank 44 percent last year to 239 million litas ($60.9 million) due to the drop in world fertilizer prices, posting an unaudited loss of 89 million litas. Lifosa specializes in producing inorganic acid, as well as nitric, phosphorous and potassium fertilizers. Evrochim is a leader of mineral fertilizer production in Russia, with more than $600 million in turnover in its four factories employing some 20,000 people. (Agence France-Presse)

CABLE THIEVES: Broadcasting by the national Latvian Television network has been hampered by the April 15 theft of 1,500 meters of wiring linking the national television center to the nearby television tower on Zakusala Island in Riga. Latvian Television reported that the link to the TV and radio tower is currently running on a reserve cable. Replacement of the stolen cable will cost 20,000 lats ($31,746). The theft is the second at the network in the last month. A small two-meter-long piece of connecting cable was stolen March 25. The network has posted two guards along the cable. The network's two national television channels have been "put under threat by these thefts," network officials said in a statement. (BNS)