LJUBLJANA Aug 25 Slovenia's likely new prime
minister hinted on Monday he might scale back its privatisation
program once he forms a coalition with two parties opposed to
any large-scale sell-off of state assets.
Law professor and political novice Miro Cerar also told
parliament he would work to strengthen the banking system, whose
fragility brought the euro zone country to the verge of an
international bailout last year.
Parliament was due to confirm Cerar, 51, as the new prime
minister later on Monday. He will then have 15 days to nominate
his cabinet, which also has to be confirmed by parliament.
He told deputies before the vote his government would pursue
"strategically considered privatisation", without elaborating.
Analysts think Cerar's government might delay privatisation
and public sector reform, both seen as crucial for Slovenia to
steady its public finances after narrowly avoiding an
international bailout for its banks in December.
"Given the electorate's opposition to privatization and cuts
in public sector spending, the next government will dilute and
delay these reforms," said Tsveta Petrova, an analyst at
political risk research firm Eurasia Group.
Policy differences within Cerar's coalition would "generate
continued government instability over the next year," she added.
Cerar's centre-left SMC party is expected to sign a
coalition deal soon with the pensioners' party Desus and the
Social Democrats, which both oppose large-scale privatisation.
The three parties together will hold 52 of the 90 seats in
the new parliament following a snap election in July that gave
the SMC a mandate to restore stability and steer the country out
of its economic crisis.
The government's main task will be to reduce budget deficit
to 3 percent of GDP, as agreed with the European Commission,
from some 4.2 percent seen this year.
Cerar said the government would tightly control public
spending and not allow an increase of social transfers, like
unemployment and welfare benefits, until economic growth reaches
2.5 percent of GDP.
"We will work towards establishing a stable banking and
financial system that will support the development and
restructuring of the economy, which will improve competitiveness
and enable the creation of new jobs," he said.
Cerar's SMC was formed less than three months ago after the
resignation of outgoing Prime Minister Alenka Bratusek triggered
early election. Bratusek resigned in May because she lost the
battle for the leadership of the Positive Slovenia party.
(Reporting By Marja Novak; Editing by Zoran Radosavljevic;
Editing by Tom Heneghan)