Slovenian Prime Minister Miro Cerar’s Modern Centre Party (SMC) is polling at around 8% ahead of the June 3 parliamentary elections, making a handover of power to the opposition Slovenian Democratic Party (SDS) almost inevitable. 

Despite the expected changes in the country’s political life, it is not expected that economic prosperity will be set back following the elections, despite the achievements of Cerar’s outgoing government during the last four years.

The latest polls indicate that the largest opposition party in Slovenia, the SDS is far more popular than any other party running in the June 3 elections, with support from 23% of voters. The SDS is followed by the newly formed List of Marjan Sarec (LMS) which has the support of 14% of voters, according to pollof­polls.eu. The LMS’s popularity shows that many Slovenians want to see a new face on their political scene, in contrast to the weaker support expressed for all members of the ruling coalition.

Cerar’s SMC and its junior coalition partners, the Slovenian Social Democrats (SD) and Democratic Party of Pensioners of Slovenia (DeSUS), currently lead the Slovenian government. The SD led by outgoing Minister of Agriculture, Forestry and Food Dejan Zidan had been fighting for second place with LMS, but recently has been pushed in to third as 10% of polled voters said they support it. Minister of Foreign Affairs Karl Erjavec and his DeSUS currently can count on about 7% support, which is unsurprising since they are popular as a ‘forever coalition partner’. The main surprise is that Cerar’s SMC is backed by just 8% of voters, despite the economic advances of recent years.

Cerar took the post in 2014, when the Slovenian economy resumed growth after it contracted for two consecutive years. It went on to grow by 2.9% in 2015 and 3.1% y/y in 2016 and accelerate to 5% in 2017. Further growth is expected in the coming years, though by a somewhat slower pace of about 4%. This was confirmed by the news that GDP increased 4.6% y/y in Q1 2018. However, according to Sebastjan Jeretic, Slovenian political analyst and founder of communication consulting company Neurovirtu, the economic prosperity of Slovenia will continue regardless of the composition or political principles of the new government.

“A change of government will be even better for the economy because it will, first of all, further reduce bureaucracy. The problem of this government which is leaving now is not the economy at all, its problems are in other segments — the health system, judiciary, corruption and above all the total apathy of people. According to some prognoses, turnout can be only between 45% and 48% which is a complete disaster,” Jeretic told bne IntelliNews.

The failures of the last government in these areas have led voters to overlook Jansa’s chequered past and switch to the SDS. He was involved in one of the country’s largest scandals, the so-called Patria case, and charged with receiving bribes in connection with a deal with Finnish defence company Patria, though the charges were eventually dropped after the time limit for unfinished cases expired.

Communication failure

“This government has been lacking all the time communication skills to tell more to people about its economic results. Instead, for the entire four years the stories about catastrophe in the health sector such as waiting for a doctor’s appointment three times more than before have been all the time around… in addition to stories about corruption, affairs, having non-qualified people in important positions and similar. This government failed in communication and because of communication. During its mandate we even managed to stabilise public finances but no one cares for that because none even heard about that,” Jeretic added.

Slovenia has been improving its public finances since the European Council closed the Excessive Deficit Procedure (EDP) for the country after it brought its budget deficit below 3% of GDP in 2015 (to 2.7%) for the first time since 2008. This was followed by a 1.7% of GDP gap in 2016, before the budget swung into a modest surplus last year. The budgets for 2018 and 2019 both envisage surpluses of 0.1% of GDP.

Jeretic believes that Cerar’s centre-left government’s failures to appoint professionals to some key positions, to improve the health system, prevent corruption and be transparent contributed to the SDS and its leader, former prime minister Janez Jansa, attracting more support, even from former leftists who now plans to vote for the party despite its conservative orientation.

Into the crystal ball

Even though it is virtually certain that Jansa will win the June 3 elections, it is hard to predict who will be the SDS’s coalition partner, as parties which have similar political orientation are not certain to pass the threshold to enter the next parliament. According to Jeretic, among Jansa’s potential partners are New Slovenia (NSi), a parliamentary party with a strong liberal economic programme, the Slovenian People’s Party and Slovenian National Party, which both were out of parliament for a while but may return after June 3. 

“What goes in favour of the SDS is that there is no one big player on the other side which can gather smaller parties or needs just a smaller party support to form the government — the SDS has that,” he told bne IntelliNews.

Despite the unpredictable coalition composition, Jeretic says expectations from Jansa as the leader of the next Slovenian government are mainly to bring order in the public sector and accelerate the country’s economy. He will also have to resolve the situation at the country’s largest bank Nova Ljubljanska Bank (NLB), which the Slovenian government is required to privatise under its commitments to the European Commission. 

“Jansa’s government will definitely be much more open for privatisations because the left oriented parties still oppose them, which is what they kept from communism. Also, a tax reform could be expected from this kind of government as well as a change in the behaviour of favouring big state-owned companies, which is not a good sign for foreign investors,” Jeretic added.

According to Jeretic, even if the left oriented parties manage to form the government it would still not be an obstacle for further economic prosperity even though such government may be composed of numerous smaller parties which indicate weaker political stability.