Slovakia after the June elections

11 September 2006

Robert Fico, Prime Minister of Slovakia, began by stressing that “since its first day, the new government is proving that it is a social democratic government”.

While his government will continue with some aspects of the previous administration’s foreign policy, such as membership of NATO and the European Union, Slovakia will now be more realistic about the role that it can play. It also intends to continue its relationships with traditional economic partners in the region, even if they are not NATO or EU members.

Turning to Slovakia’s role in the United Nations, the Prime Minister said his government was ready to cooperate in eliminating the main threats to global security, but believed that force must be used in accordance with international law in order to achieve international peace. For this reason, it is withdrawing its current forces from Iraq, but will contribute in other way to “efficiently support the population’s safety” and will continue its support in Afghanistan.

Mr Fico said Slovakia supported the idea of a common European foreign and defence policy as, in his view, a common European approach to Iraq could have avoided the current “incredibly difficult situation”.

The positive impact of EU enlargement

Slovakia is a good example of the positive role that EU enlargement can play, since the preparations for membership “had a significant impact” on modernising the country’s economic and legal systems. The government supports further enlargement, including Bulgarian and Romanian membership from January 2007, and wants to maintain long-term membership prospects for other Eastern Europe countries.

However, the Prime Minister cautioned that after two years, Slovakian citizens were becoming more aware of the other, “shadier side of the EU”, finding it distant and its terminology virtually incomprehensible. They also find the ‘old’ EU-15 Member States’ reticent about accepting the new “institutional arrangements”, and slow to lift the transitional arrangements on, for example, the free movement of workers. Despite these misgivings, the new government is strongly pro-European and is intent on persuading Slovakians of the importance of ratifying the EU’s Constitutional Treaty.

Being a true part of the EU

The Prime Minister said that although it was a demanding process, the government was determined to follow the original timetable for joining the Schengen zone. Slovakians cannot understand why it is currently so easy for them to cross some borders but impossible to cross others. They are also critical of the remaining barriers in the labour and services market. While some countries - such as Belgium - have made changes, others have not. “Either we are an equal EU member, or (if not) new Member States have a right to protect their interests,” argued Mr Fico.

He also emphasised that energy safety was an integral part of general safety. The previous government’s mistakes had changed Slovakia from a country that exported electricity to one which would shortly be forced to import 25–30% of its supplies. However, the decommissioning of two units of the Jaslovské Bohunice nuclear power plant will go ahead and the government wants to win back Russian company Jukos’ 49% share in Transpetrol.

Building an efficient welfare state

Turning to domestic policies, Mr Fico said Slovak citizens were currently dealing with the problem of how live on €200 a month while prices are rising to EU levels.

His government is ambitious - it wants to comply with the Maastricht criteria for membership of the euro zone and join in January 2009 while, at the same time, becoming “an economically efficient welfare state”.

The Prime Minister admitted that this would be a challenge, as it meant keeping the budget deficit to 3% while, for example, compensating people who had lost funds when the previous government introduced a privatised Social Insurance Scheme. He said that thanks to the previous government, Slovakia’s poverty and unemployment rates were among the highest in the EU. It also had some of the biggest regional differences, lowest salaries and most liberal labour codes. “No wonder the electors replaced that government,” he said, accusing it of using low salaries, privatisation of strategic assets and tax dumping to compete for international investment.

Mr Fico stressed that creating an efficient welfare state was in line with Europe’s values of solidarity, social justice and equality of opportunities, and would fulfil the Slovak Constitution’s promise to provide a “socially and ecologically oriented market economy”. A key aspect of this was to invest in education to create an information-based society. Any delay in achieving this would hinder attempts to raise the country’s living standards to those in other parts of the EU.

Financing government programmes

The Prime Minister said the money to finance the welfare state while meeting the strict Maastricht criteria would come from four basic sources:

1) Maintaining economic growth - predicted at 7% for 2007 and 5% for subsequent years.

2) Making savings by avoiding the previous government’s mistakes, and cutting government overspending and unnecessary bureaucracy.

3) Using €11 billion worth of EU funds between 2007 and 2013 efficiently to reflect the priorities of the Lisbon Strategy and address regional differencies.

4) Cutting down irregularities in government spending and stopping the plundering of state assets, the “tunnelling of state companies” and overpriced public contracts. This would save €2 billion.

The Prime Minister said the challenge for the new government was to end the shadow economy in which financial groups and corruption had determined policies.

He finished by stressing that the new government was ready to implement social democrat policies that reflected European values. At the same time, it would spend a “significant portion of its energy” on improving the living standards of all those living in Slovakia, including Slovaks, Czechs, Hungarians, Germans, Ukrainians and Roma.