Thursday, March 14, 2013

Slovenia's incoming PM forms majority coalition

By Marja Novak

LJUBLJANA (Reuters) - Slovenia's incoming prime minister formed a four party-coalition on Wednesday which would command a firm majority in parliament as it attempts to pull the country out of a new recession and avoid an international bailout.

Positive Slovenia (PS) leader Alenka Bratusek speaks during a news conference after the parliament dismissed Slovenia's Prime Minister Janez Jansa's ruling coalition in Ljubljana February 27, 2013. REUTERS/Srdjan Zivulovic

The four parties, led by Prime Minister-designate Alenka Bratusek of centre-left Positive Slovenia, together hold 49 out of 90 seats in parliament.

Parliament is due to vote on Bratusek's proposed cabinet next week. If confirmed, the new government will take over from conservative Prime Minister Janez Jansa, who was voted out by parliament along with his ruling coalition on February 27 after losing a majority in parliament over a corruption scandal.

The coalition agreement is expected to be signed later on Wednesday, while Bratusek is due to present her cabinet to parliament on Thursday.

"The crucial point is who will be the next finance minister. With a sensible person in that position Slovenia could avoid a bailout at least for this year," Borut Hocevar, a political analyst for the daily Finance newspaper, told Reuters.

An election is due in late 2015 but the coalition parties agreed Bratusek would ask for a confidence vote in parliament one year from now to give the coalition partners an option of a snap election.

Slovenia, which adopted the euro in 2007, is burdened by a rising amount of bad loans in local banks, mostly state-owned, which reached some 7 billion euros (6 billion pounds) at the end of 2012, equalling 20 percent of GDP.

The country also is struggling with a new recession amid lower export demand and a fall in domestic spending caused by budget cuts.

Bratusek, who would be Slovenia's first female premier, had said Slovenia can avoid a bailout but has not yet explained how the incoming government will solve the problems of the ailing banks.

Slovenia in October issued its first bond in 19 months, averting a bailout at least until June. It is expected to tap the markets again in the coming months as it has to repay some 2 billion euros of outstanding debt in the middle of this year.

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Thursday, March 14, 2013

Slovenia's incoming PM forms majority coalition

By Marja Novak