Slovenia: political tremors

More cracks in the rock that once was Slovenia. A shock win for the opposition candidate in the first round of the presidential election and a possible trade union-backed referendum on the government’s economic restructuring plans.

It’s not what Ljubljana needs in its efforts to reassure markets that it won’t require an international bailout.

Timothy Ash, of Standard Bank, said in a note on the eurozone nation:

Double whammy of negatives today, with the opposition candidate winning the first round of the presidential election – not sure how cohabitation will help given the government’s efforts to avoid an international bail-out.

And, second the speaker of the lower house of parliament is indicating that a referendum on the [government's plans for a bad bank and a sovereign wealth fund] now seems likely after trades unions tabled a motion and are working to get signatures. The hope had been that Slovenia could escape such a referendum, at least on the bad bank, if not the Slovenia sovereign holding company.

The electoral commission said on Monday that Borut Pahor, a former prime minister and member of the opposition Social Democratic party, won 40 per cent of the vote, beating the incumbent president and favourite Danilo Turk, who secured 36 per cent. Milan Zver, the government-backed member of the European parliament (MEP), was third on 24 per cent.

That means Pahor and Turk will run against each other in a second-round vote on December 2.

Meanwhile, parliamentary speaker Gregor Virant was expected to back the start of a 35-day period in which a trade union that initiated a referendum call on the government financial restructuring plan can collect the 40,000 signatures needed for the motion to go ahead, according to Bloomberg.

Slovenia’s politicians will have little time for skiing this winter.

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