EP elections do not lead to early elections




  • For the second time in succession, Slovakia recorded the lowest voter turnout among all EU countries in the European Parliament elections: 19.6 percent of eligible voters went to the polls on the 6th June. PM Robert Fico placed responsibility for Slovaks’ lack of interest in the elections squarely at the door of the media.
  • All coalition parties passed the 5% threshold.
  • Following the elections the Hungarian Coalition Party broke into two, resigning MPs established a new party.


Analysis and forecast (↓ decreasing risk)


The lowest turnout for the second time is quite embarrassing for the fresh EU-zone country; however, it was a bit higher than in 2004, while the average turnout fell by 2.5%.

The leading position of SMER still cannot be questioned, but – as Political Capital forecasted earlier – the assessed above 40% support of the party seems overestimated (naturally low turnout distorts).
The subject of early elections will be eliminated, since the leading governing party has very low chance to gain the 50% of the 150 mandates.

The tensions that led to the break-up in the Hungarian party endanger the representation of the minority (even in Romania – where Hungarian minority is significantly more populous than in Slovakia – second ethnic party could not strike root).



Government strategy changed in communicating GDP shrink



The Slovak central bank (NBS) in a new prognosis, expects Slovakia’s GDP to shrink by 4.2 percent in 2009. The economy is expected to revive next year, when NBS expects growth of 2.4 percent, with a further boost of 4.1 percent in 2011. The Finance Ministry predicts the Slovak economy to shrink by 6.4 percent.



Analysis and forecast (↑ increasing risk)


The NBS is more pessimistic than in April, when it was the first official Slovak institution to forecast that the Slovak economy would contract by 2.4 percent. According to Finance Minister Ján Počiatek, the ministry tried to make “as conservative a prognosis as possible”. Strategy seems to be changed in the government: after the 2008 point of view when denying even the chance of the recession in the country, the government now tries to overestimate the GDP shrink data in order to make possible to communicate a 5-6 percent recession as a success. The problem is that the 6.4 percent data is quite realistic, according to most analysts, to the first quarter shrink figure (-5.4 percent) and to the significant worsening of the external environment of the Slovak economy.




Source: the above mentioned 4 institutes