Fico favorite as Slovakia sets June 12 poll
BRATISLAVA (Reuters) - Slovak Prime Minister Robert Fico's chances of winning a June 12 general election rose on Monday when his main rival, center-right ex-premier Mikulas Dzurinda, pulled out over accusations of money laundering.
The dramatic withdrawal of the man who led Slovakia into the European Union and enacted far-reaching market reforms between 2002-2006 was a boost for Fico's socialist Smer party, which has ruled in coalition with nationalists and right-wing populists.
The euro zone's newest member since January 2009 is emerging from a deep recession but analysts expect ethnic tensions and accusations of corruption and cronyism rather than economic policy to dominate the campaign.
Dzurinda's center-right government introduced a 19 percent flat tax on income and corporate profits which lured foreign direct investment worth billions of euros, notably in the auto industry. Fico advocates a strong state role in the economy but has departed little from orthodox policies.
"The key reason for me (not to run) was a monstrous game by Robert Fico," Dzurinda told journalists, denying the allegations and challenging Fico to debate them on television.
"I feel very sorry for him (Fico) ... He has disgraced and insulted his post," he added.
Fico, 45, already favorite to win re-election, has repeatedly accused Dzurinda's SDKU party of money laundering and using tainted funds to finance its political activities.
"I expect this to have a marked impact on SDKU. Part of the party's electorate could desert to Freedom and Solidarity," said political columnist Marian Lesko of leading daily Sme, referring to a new opposition party which has similar policy aims to SDKU.
Slovaks enjoyed the fastest growth rate in the EU for years, reaching a record 10.6 percent in 2007, but the global downturn took a deep bite, axing jobs and raising the fiscal deficit.
Fico came to power in 2006 teaming up with former autocratic Prime Minister Vladimir Meciar's nationalist HZDS party and the right-wing populist Slovak National Party (SNS), led by the firebreand Jan Slota.
Smer, which Fico has led since its foundation in 1999, is hovering around 40 percent in opinion polls and holds a wide lead over center-right rivals.
Analysts say Fico has a strong chance of forming a two-party government, either with one of his current partners or with an opposition party. He has not ruled out either option.
Strained relations with neighboring Hungary, where conservative opposition Fidesz leader Viktor Orban is runaway favorite to win an April general election, will be among the top campaign issues in Slovakia, analysts say.
"Smer is using and will use the Hungarian card, it feeds distrust toward Hungary ... this will be their evergreen," said Grigorij Meseznikov, the head of the Institute for Public Affairs, a think-tank.
Slovaks have a history of diplomatic rows and harsh rhetoric with their southern neighbor. Almost half a million ethnic Hungarians live in Slovakia, about 10 percent of the 5.4 million population, mostly in southern regions.
Tension rose last year over a language law stipulating that only the Slovak language may be used in most public offices and institutions, seen by many ethnic Hungarians as the latest in a series of moves by the nationalist-minded government to suppress their culture.
Hungary's president canceled a planned unofficial visit to ethnic kin in Slovakia last August after the Bratislava government called the trip a provocation.
(Reporting by Martin Santa, editing by Paul Taylor)
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