Rumbles from the East Need Not Spark Turmoil

Views on BG | March 26, 2009, Thursday // 12:32

From The Financial Times

By Jan Cienski, Thomas Escritt and Stefan Wagstyl

The loss of one east European government in the midst of the global economic crisis might be dismissed as an accident. The demise of three in six weeks suggests the region faces instability at a time when strong governments are needed.

The Czech government fell this week, days after Ferenc Gyurcsany, Hungary's premier, announced plans to resign, and a month after Latvia's administration quit.

But politics is not so simple. The economic crisis is not the only force at work. Nor is eastern Europe alone.

Governments have fallen in western Europe - in Iceland and Belgium.

The demise of the Czech government had little to do with the economy and everything to do with political weakness. Mirek Topolanek, the centre-right prime minister, had a majority of just one in the 200-seat parliament. He survived four no-confidence votes before falling to a fifth, called by the Social Democrat opposition over a vote-buying scandal.

Coming during Prague's six-month stint as European Union president it embarrassed the nation. With elections possible this year, the economy will become an issue, but Prague, with sound public finances, is managing the crisis better than most countries in Europe - east or west.

Hungary and Latvia are more worrying. Both entered global crisis with home-grown economic difficulties. Both have needed EU/International Monetary Fund rescues and face deep recessions.

In Riga, the government of prime minister Ivars Godmanis, who quit last month, has been followed by a broader coalition headed by the New Era anti-corruption party. With budget cuts multiplying and unemployment soaring, almost all the political elite is unpopular. Riga witnessed a small riot in January.

Neighbouring Lithuania has also witnessed anti-government protests.

In Hungary, president Laszlo Solyom called yesterday for early elections following Mr Gyurcsany's resignation announcement - a demand echoed by the conservative opposition Fidesz party. But the ruling Socialists prefer to avoid electoral slaughter and want a non-party prime minister to drive reform.

Lajos Bokros, a respected former finance minister whose name has been floated as a possible prime minister, yesterday told the Financial Times: "For us it's now a choice between more crises and bankruptcy." It is unlikely Fidesz and the Socialists can overcome mutual hostilities.

Further east and outside the EU, recession-hit Ukraine faces even greater difficulties, with power split between Viktor Yushchenko, the pro-west president, and Yulia Tymoshenko, prime minister who has looked to Russia for support. Both are more concerned about presidential elections than reviving Kiev's IMF rescue.

On a less dramatic scale, Bulgaria may see turmoil, with the Socialist administration facing likely defeat in parliamentary elections this summer because of a poor anti-corruption record and economic distress.

With the moderate centre-right groupings weak, the likely election winner is Gerb, the anti-corruption party led by Sofia mayor Boyko Borisov.

Elsewhere governments seem solid, not least in Poland, the largest EU new entrant. Donald Tusk, the liberal prime minister's Civic Platform, which swept to power in 2007 is still popular. There are tussles with president Lech Kaczynski, whose twin brother Jaroslaw heads the opposition conservative Law and Justice party, but not enough to hurt the government. Eugeniusz Smolar, head of Warsaw's Centre for International Relations, says, "Civic Platform will do everything to maintain the positive atmosphere before the (2010) presidential elections," when Mr Tusk plans to run.

In Slovakia, Robert Fico, the prime minister, is popular. His leftist Smer party rules in coalition with HZDS of the former authoritarian prime minister, Vladimir Meciar, and the rightwing Slovak National party. Mr Fico has masterered this unlikely combination and successfully led Slovakia into the eurozone.

Romania has been prone to turmoil, but seems to be in stable political shape. President Trajan Basescu last year saw his allies in the Democratic-Liberal party win the parliamentary elections, ending repeated disputes between president and parliament, and preparing the way for Mr Basescu to claim a possible victory in this year's presidential polls. But the country has signed up for an IMF rescue and the economy contracted.

The former Yugoslavia remains racked by legacies of the 1990s, not least in Bosnia. But Serbia, the largest western Balkan state, has, under liberal president Boris Tadic, emerged as a bastion of stability.

Outside Ukraine, these countries are current or future EU members. They benefit from EU aid and a policy framework, which can act as a stabiliser. It may be more necessary than ever.

 

We need your support so Novinite.com can keep delivering news and information about Bulgaria! Thank you!

Views on BG » Be a reporter: Write and send your article
Tags: Czech Republic, Hungary, Latvia, recession, government

Advertisement
Advertisement
Bulgaria news Novinite.com (Sofia News Agency - www.sofianewsagency.com) is unique with being a real time news provider in English that informs its readers about the latest Bulgarian news. The editorial staff also publishes a daily online newspaper "Sofia Morning News." Novinite.com (Sofia News Agency - www.sofianewsagency.com) and Sofia Morning News publish the latest economic, political and cultural news that take place in Bulgaria. Foreign media analysis on Bulgaria and World News in Brief are also part of the web site and the online newspaper. News Bulgaria