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Slovenian report Slovenian report
by Euro Reporter
2014-09-22 05:14:15
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Slovenia's incoming government wins parliamentary confidence vote

Slovenia's incoming center-left government on Thursday won a parliamentary confidence vote, ending a period of political instability marred by years of recession, financial problems and corruption scandals. The newly formed party of Miro Cerar, a 51-year-old law professor and newcomer in local politics, won the snap July parliamentary election, the second in the history of this nation of two million. As prime minister, Mr. Cerar will lead a coalition government that, even though described as center-left, has promised a cut in public spending to reduce public debt, estimated to exceed 80% of the country's total annual output this year. The European Union's debt limit is 60% of GDP. "Our fiscal policy will be restrictive; we have to reduce public spending and increase the efficiency of tax collection," Mr. Cerar told lawmakers ahead of the confidence vote. The three-party coalition government won approval from 54 lawmakers in total, indicating solid support for Mr. Cerar's policies. Only 85 lawmakers took part in the confidence vote, with 25 voting against the new government and six abstaining. Mr. Cerar's center-left Party of Miro Cerar, or SMC, and its two coalition partners—the Social Democrats and the Democratic Pensioners' Party of Slovenia—hold 52 out 90 votes in parliament.

Mr. Cerar, whose family is well-known in Slovenia thanks to his Olympic-medalist father, also reiterated his resolve to kick-start economic growth by selling state-owned assets and attracting more foreign direct investment. The European Commission expects Slovenia's economy to post mild 0.8% growth this year, its first since 2009. In December 2013, the previous Slovenian government narrowly dodged an international bailout for its lenders by injecting $4.4 billion of taxpayers' money in the ailing banking sector, whose problems were aggravated during the eurozone's debt crisis. Previous administrations also kept tight guard of the nation's family silver, holding on to a number of companies as diverse as ski- and sailboat-maker Elan d.o.o., household goods firm Paloma and insurer Zavarovalnica Triglav.  Mr. Cerar, the country's fourth prime minister since 2008, has pledged to reduce the government's role in the economy while maintaining control of strategic assets. The government is determined to go ahead with the earlier approved plan to sell 15 state-owned enterprises, including Slovenia's main telecommunications operator Telekom Slovenije and Nova Kreditna Banka Maribor d.d., the number two lender by assets.

Despite winning the parliamentary approval, potential future political instability may still threaten Mr. Cerar's coalition, said Otilia Dhand, a political risk analyst at Teneo Intelligence. The Social Democrats, holding six parliamentary seats, are against selling state assets while the Pensioners' party, with 10 seats, opposes cuts in retirement entitlements, she said. "Besides the potential loss of one or both coalition partners, SMC itself lacks internal cohesion" and sticks together thanks to its founder, Ms. Dhand said. Thursday's approval of Mr. Cerar's government came amid unusual circumstances, with one parliamentarian—who had twice served as prime minister—attending the parliamentary session on a prison furlough. Janez Jansa, who is now the head of the country's largest opposition party, began serving his two-year sentence for corruption just weeks ahead of July's parliamentary election. He was able to register for the vote, launch his Slovenian Democratic Party's campaign before going to prison, and was elected in absence. Mr. Jansa, who served as the prime minister from 2012 through 2013 and from 2004 through 2008, has denied wrongdoing and appealed against the sentence to the country's Supreme Court.

Earlier Thursday, the country's highest criminal court set Sept. 30 as the start of its hearing into Mr. Jansa's case, centered on his alleged knowledge of a bribe offered in a military equipment tender in 2008, during his first term as prime minister. "I was accused, sentenced and then sent to prison because I had supposedly received the promise of an unknown award, in an unknown place, at an undetermined time, amid undetermined circumstances and by an undetermined way of communication," Mr. Jansa said during a session break ahead of the confidence vote. The former premier is required to return to his prison near Ljubljana no later than two hours after the legislative session ends. He said he would pursue his appeal all the way to the Slovenian Constitutional Court and the European Court of Justice to prove his innocence. Mr. Jansa's presence in parliament, made possible by temporary jail leaves, put his status in the spotlight. Some members of the new government have called on lawmakers to follow the British example which passed a law 33 years ago to ban people serving prison sentences for more than one year from running for parliament seats.

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Slovenia aims to cut budget gap, steady public finances

Slovenia's incoming coalition government will focus on reducing the budget deficit and ensuring the long-term sustainability of public finances, Prime Minister Miro Cerar told parliament on Thursday.

The euro zone member state narrowly avoided an international bailout to fix its ailing banks in December and investors are anxious to see it return to political and financial stability.

"Our fiscal policy will be restrictive, we have to reduce public spending and increase the efficiency of tax collection," Cerar said at the start of the session. Parliament is due to vote on his centre-left cabinet later on Thursday.

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Slovenian EPP MEPs to Vote against Commission Including Bratušek

Slovenian MEPs from the ranks of the European People's Party (EPP) have announced they will vote against the new line-up of the European Commission at the plenary session of the European Parliament unless Alenka Bratušek is replaced as Slovenia's commissioner.


       
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