Slovene parliament backs first big government reshuffle since bailout avoided

LJUBLJANA Mon Feb 24, 2014 2:00pm EST

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LJUBLJANA Feb 24 (Reuters) - Slovenia's parliament on Monday approved the first major government reshuffle since the euro zone member narrowly avoided an international bailout late last year.

After a year of speculation that Slovenia might become the bloc's next rescue case, the government announced in December it could overhaul its troubled banks alone, to the relief of its European Union partners.

Among the changes, parliament confirmed that Metod Dragonja, ex-manager of drugmaker Lek and economy minister in the 1990's, would take on the economy portfolio.

Prime Minister Alenka Bratusek said she hoped the reshuffle of her centre-left cabinet would help revive growth and set in motion the long-overdue health system reform in the small Alpine nation.

Epidemiologist Alenka Trop Skaza, a newcomer to politics, becomes health minister, while Gorazd Zmavc was voted in as Diaspora Minister to succeed Tina Komel. Komel stepped down last week to make room for a new cabinet member following an agreement between Slovenia's four ruling parties to amend the coalition pact.

The economy and health ministry posts werer left vacant in November when Stanko Stepisnik and Karl Erjavec resigned, with their briefs being temporarily filled by the finance and foreign ministers.

Since taking the helm in March last year, Bratusek's cabinet has overhauled the state's banking sector by pumping 3.3 billion euros into troubled local banks and cleaned up bad loans worth nearly 8 billion euros, the equivalent of almost one quarter of national output.

The cabinet also plans to sell more than a dozen state-controlled firms including Telekom, the top national telecommunications group, Ljubljana airport, flag carrier Adria Airways and No.2 bank NKBM. It has sold two smaller companies since October. (Reporting by Almir Demirovic; Writing by Maja Zuvela; Editing by Toby Chopra)

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