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Booming economy may not save Slovak PM from defeat

Written by: Staff
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BRATISLAVA, Apr 17: On the face of it, Slovak Prime Minister Mikulas Dzurinda should be cruising to victory and a record third term in office in June's general election.

Under his eight-year stewardship, Slovakia has shed an image of a scruffy, isolated central European pariah, joined the European Union and NATO, and thanks to energetic liberal reforms attracted 11 billion dollars in foreign investment.

Its economy has grown 17 percent since 2002, unemployment has fallen to 12 percent from nearly 20 percent and Slovakia is becoming Europe's biggest car maker per capita, churning out VWs, Kias, and Peugeots in state-of-the-art factories.

Slovak cities, led by Bratislava, have started attracting tourists and foreign real estate investors. There is new energy in the capital as people spill out of the bars, restaurants and cafes that crop up seemingly on a weekly basis.

And yet, Slovaks seem bent on replacing Dzurinda with leftist populist Robert Fico, who spent the past four years promising to undo most of the reforms and stem the flow of foreign investment that underpins Slovakia's success.

Investors are baffled but local analysts say fatigue after eight years of tough reforms that cut welfare and exposed people to more competition is one reason why Dzurinda's SDKU party is trailing Fico's Smer by 20 percentage points in opinion polls.

''Outsiders judge Dzurinda by reforms and his staying power, and they have a fairly homogenous good opinion of him,'' Grigorij Meseznikov, head of the Institute for Public Affairs in Bratislava, said.

''Inside the country, he is seen as the initiator of reforms that hurt and as a non-transparent leader.'' Dzurinda's popularity even among his core well educated, urban supporters, has declined since 2002 when his four-party coalition began creaking due to what his detractors inside the government called a dictatorial streak.

''Many of Dzurinda's former voters support the country's general direction, but they have an ethical problem with him,'' said Martin Slosiarik, analyst at the Focus polling agency.

In a bizarre outburst in 2003, Dzurinda accused a group of businessmen, journalists and politicians of plotting against him and sacked a high-ranking intelligence official who he said was leading the plot.

''Dzurinda has occupied Slovak society like a Turkish sultan,'' says Zuzana Martinakova, a former Dzurinda ally, who formed her own group, Free Forum, which is running just behind his party in opinion polls.

COMEBACK KID

Dzurinda dismisses talk of his imminent departure, saying he aims to repeat the trick from four and eight years ago when he came from behind to defeat rivals such as autocratic former Prime Minister Vladimir Meciar.

''I am going to do a lot of travelling,'' he said. ''By train, car, plane. I will make real contact with voters and explain that (our) path brings concrete results.

Born in an eastern Slovak village, the 51-year-old former railway executive was a shaggy-haired opposition leader barnstorming the country on a 10-speed bike ahead of 1998's elections, in which he defeated Meciar and thus brought Slovakia out of the cold. ''It was like fresh air swept into central Europe,'' former U.S. ambassador Ralph Johnson told Reuters. ''Lots of bright young people came into office.'' Analysts point out that despite his blunders and poor public relations, Dzurinda has displayed remarkable political prowess by keeping his fractious minority coalition together, pushing through his flagship flat tax of 19 percent and setting the country on course to the euro.

With eight parties set to enter parliament, Dzurinda may yet prove to be an essential part of any post-election formula, particularly since Fico is unlikely to find eager partners.

''Dzurinda is a very skilled politician,'' Meseznikov said.

''And his election results could well end up better than polls say.'' Dzurinda says he will persuade Slovaks that they are much better off thanks to his liberal economic reforms and that living standards will improve further.

''Real wages grew by 6 percent last year,'' Dzurinda recently told a group of students. ''That's the highest rate in Europe.

What else can we ask for? Now let's keep it up.'' SEA CHANGE? Some analysts say Dzurinda's departure would mean a sea change in how the country is perceived by markets -- if not a correspondingly large shift in policy.

''Under Dzurinda, Slovakia has been this amazing story of rags to riches,'' said Lars Christensen, an economist at Danske Bank.

''If Dzurinda is replaced by Fico, I think the story suddenly turns, with Fico viewed as a big negative, and markets getting nervous very quickly.'' Yet even in Bratislava prosperity cannot come fast enough for a nation still adjusting to a world in which top businessmen make millions and ordinary workers fear for their jobs.

Jozef Ciglan, a 63-year-old taxi driver who makes 14,000 Slovak crowns (8) a month, says his bills are rising just as fast as his wages, and that talk of an economic miracle just makes him frustrated.

He voted for Dzurinda in 2002 but will stay away from the polls this time.

''I make 38 crowns less for every 100 I take in than I did 10 years ago,'' he said. ''Gas is more expensive. Insurance is higher. Parking costs six times more. I'm no better off.''

Reuters

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