Slovenia's fragile recovery
Eastern approaches 2014-05-03
Summary:
A week that began amid political instability in Slovenia will end on a higher note for the government. Alenka Bratusek, the country’s prime minister and the leader of a centre-left coalition, lost a race to stay on as leader of her own party on April 26th. In the aftermath she said she planned to resign, but recent signs point to the government staying on until early elections in the fall—significant for stability in the coming months as the country tries to dig itself out of the deep fiscal crisis that only peaked late last year.
After Slovenia narrowly avoided an IMF bailout at the end of 2013, Ms Bratusek embarked on a campaign to recapitalise the country’s troubled banking sector by injecting €3,2 billion ($4,4 billion) and getting rid of bad debt. Slovenia was among the last of eurozone members to begin cleaning up its banks. The state is now in the process of selling off a significant number of assets to cover the bill for bailing out the banks. This is a sea change in a country where some estimate that state-owned assets account for up to 60% of GDP.
The political uncertainty is not fully...Continue reading