* Euro zone country narrowly avoided international bailout
* Son of Olympic athlete wins, must lead recovery
* PM frontrunner cool on some privatisations
* Investors wary of backsliding
(Updates with official count)
By Marja Novak and Zoran Radosavljevic
LJUBLJANA, July 13 Centre-left political novice
Miro Cerar led his party to victory in Slovenia's election on
Sunday, indicating he would rewrite a reform package agreed with
the European Union to fix the euro zone member's depleted
The result will test investor nerves, given Cerar's
hostility to some of the big-ticket privatisations that the EU
says are key to a long-term fix for Slovenia, which narrowly
avoided having to seek an international bailout for its banks
Cerar's six-week-old SMC party won 34.8 percent of the vote,
which translates to 36 seats in the 90-seat parliament. That
would give the 50-year-old law professor the strong mandate his
recent predecessors have lacked, potentially going some way to
restoring political stability after years of turbulence and weak
The centre-right SDS party was in second place with 20.6
percent and a string of smaller centre-left parties also won
seats and were lining up to join Cerar in government.
Success for Cerar, whose Olympic gymnast father was one of
Slovenia's greatest ever sportsmen, is punishment by voters for
the traditional parties, tarnished by corruption scandals and
years of economic turmoil in the ex-Yugoslav republic.
Outgoing Prime Minister Alenka Bratusek called Sunday's snap
election after losing public confidence. Cerar's government will
now oversee a raft of crisis measures agreed with the EU to
reduce Slovenia's budget deficit and remake an economy heavily
controlled by the state.
Cerar, however, opposes the sale of telecoms provider
Telekom Slovenia and the international airport,
Aerodrom Ljubljana, fuelling investor fears of
Suggesting he planned to revisit the crisis programme agreed
under the previous government, Cerar told Reuters: "Our party
will aim for Slovenia to fulfil its EU obligations but within
that we will seek our own ways to reach these goals in the best
way for Slovenia."
He said his cabinet would immediately consider which
companies would remain in state hands and what to do with the
rest. "I'll do my best to have our privatisation programme in
place this year," he said. "This will be one of the priorities
of the government."
The outgoing government suspended the privatisation process
this month pending the formation of a new government, which is
not expected before mid-September.
Cerar will have to find other ways to raise cash if he is to
meet a target agreed with the EU to slash back Slovenia's budget
deficit to 3 percent of output by 2015, from a forecast 4.2
percent this year.
He will form the fourth government since the 2008 financial
crisis, which shredded Slovenia's reputation as an economic
trailblazer in ex-Communist Eastern Europe.
Analysts expect him to turn to the Social Democrats (SD) and
the Desus pensioners' party to form a coalition, but he may cast
the net even wider in order to shore up support.
Both the SD and Desus were part of the outgoing cabinet and
were reluctant recruits to the toughest of Bratusek's crisis
measures, particularly privatisation.
"In the more likely scenario that the centre-left assumes
power, the next cabinet will likely delay or halt many of the
reforms necessary to improve Slovenia's public finances," said
Tsveta Petrova, an analyst at Eurasia group.
"Still, the country might see some anti-corruption
initiatives in line with Cerar's election campaign."
Cerar created his Party of Miro Cerar (SMC) barely six weeks
ago and shot to the top of opinion polls among voters looking
for someone new and untarnished by the corruption scandals that
have dogged the mainstream parties.
He owes much of his celebrity to his gymnast father, twice
Olympic pommel horse champion when Slovenia was part of
State meddling in the economy was at the heart of the crisis
that began when the global economic downturn hit Slovenia's
vital exports. Bad loans exposed years of reckless lending and
an economic model that had largely avoided the privatisations
pursued by others in Eastern Europe after the Cold War ended.
In December 2013, Bratusek's government poured 3.3 billion
euros into the banking system to keep it afloat and avoided
becoming the latest member of the 17-nation euro zone to seek a
bailout from the European Union and International Monetary Fund.
(Writing by Matt Robinson; Editing by Susan Fenton)