Bloomberg News

Slovak Premier, Philanthropist Head to Presidential Runoff (3)

March 16, 2014

Slovak Prime Minister Robert Fico

Slovak Prime Minister Robert Fico is striving to consolidate his Smer party’s lock on power in the eastern euro-region member by becoming the head of state and hand-picking his successor to lead the cabinet. Photographer: Tomas Benedikovic/isifa via Getty Images

Slovak Prime Minister Robert Fico will compete with philanthropist Andrej Kiska for the presidency in a tougher-than-expected March 29 runoff after winning the first round with a narrow lead.

Fico, the nation’s most-popular politician for the past decade, won 28 percent of votes in the first-round ballot held yesterday, followed by the 51-year-old businessman-turned-philanthropist, with 24 percent, the statistics office said on its website today. Opposition candidates who finished third and fourth have said they would urge voters to back Kiska in the final round.

Fico, who is halfway into his second term as premier, is striving to consolidate his Smer party’s lock on power in the eastern euro-region member by becoming the head of state and hand-picking his successor to lead the cabinet. To realize his goal, he will have to win over voters disappointed in his failure to boost job creation even as the economy expands.

“Fico has a problem, Smer voters didn’t show up and it’s questionable whether he will be able to mobilize them,” Pavel Haulik, the director of pollster MVK, said by phone. “Chances are still balanced, but after yesterday, Kiska has a bigger chance.”

Consolidating Opposition

Given Kiska’s grassroots support in his first foray into national politics, he may benefit in the second round. Losing contestants, including Velvet Revolution icon Milan Knazko and opposition lawmaker Radoslav Prochazka, said in a debate on March 3 they would urge their supporters to throw their votes his way to thwart Fico’s ambitions. Their combined support in yesterday’s ballot was 34.1 percent.

“I expect the second round to be very interesting,” Fico told reporters earlier today, Sme news website reported.

Turnout in the first round was 43.4 percent. Kiska would defeat Fico in the decisive round by winning 53.7 percent of the vote, compared with Fico’s 46.3 percent, according to a survey from pollster Focus made from Jan. 27 to Feb. 5. The survey, which had no publicized margin of error, was conducted among 1,051 Slovaks before the first round.

“Fico is a populist with authoritarian tendencies,” said Grigorij Meseznikov, the director of the Bratislava, Slovakia-based Institute of Public Affairs. “On the other hand, Kiska is viewed as a success story. His absence from politics so far is a huge advantage. Voters are disappointed with politics as usual.”

Voicing Opinions

If elected, Fico has said he wants to make the largely ceremonial presidency more active, especially in voicing opinions abroad.

He has rebuffed concerns about a concentration of power, saying the country “can’t afford an experiment of having a president who would be in an open conflict with the government,” according to a Feb. 8 interview for Mlada Fronta Dnes newspaper.

Hours after first-round results were released, Fico and Kiska started dueling for voters’ approval.

“The president should be an experienced politician who knows what the world is about and who has contacts abroad,” Fico said in a debate on public STV television today. The final round will provide a choice between “a candidate who’s offering his experience and a candidate about whom we don’t know a thing.”

Kiska, who took part in the same debate, retorted that while Fico has ruled the country for six years “people aren’t satisfied.”

Ordinary People

“The question is whether such a person should be given another five” years in power, Kiska said. “Traditional politicians have failed to solve the problems of ordinary people.”

Fico, a former Communist Party member who was first elected to parliament in 1992, oversaw Slovakia’s switch to the euro in 2009 as prime minister.

His cabinet probably managed to cut the budget deficit below the European Union’s ceiling of 3 percent of economic output last year, from 5.1 percent in 2011, according to a European Commission estimate.

It also introduced special levies for selected industries and raised income taxes for corporations and the country’s highest earners to raise revenue, in line with a campaign pledge not to let poorer citizens feel the impact of fiscal consolidation.

Bonds, Growth

The yield on the Slovak benchmark bond due 2023 fell to 2.193 percent, the lowest since the security was issued, on March 13, before rising to 2.21 percent a day later. Slovakia’s borrowing costs have fallen below better rated Belgium, as Fico’s administration has trimmed the budget deficit to differentiate the country from ailing euro-area members.

The Slovak economy grew 0.9 percent in 2013, compared with a 0.5 percent contraction in the whole euro area. Growth is set to accelerate to 2.3 percent this year, the Slovak Finance Ministry forecasts.

Fico’s opponents, including Kiska, argue that some government measures will further crimp the creation of new jobs at a time when the unemployment rate, at 13.6 percent in February, is almost double the 2008 level.

Consumer-Credit Companies

Kiska co-founded two consumer-credit companies in the late 1990s before selling them in 2005 to the Slovak unit of Intesa Sanpaolo SpA. (ISP) He made about 10 million euros ($13.9 million) for his stake in the business.

Since the sale, he’s focused on philanthropy, having donated at least 2.5 million euros to the nation’s largest charity, Good Angel, which he founded.

“We need to make sure that the presidency doesn’t go to Fico,” Kiska said in March 5 interview in a Bratislava cafe, where he sipped cappuccino and picked at a piece of chocolate cake. “We don’t want all the top posts to be held by one party. We’ve already had that here for 41 years under communism.”

To contact the reporters on this story: Andrea Dudik in Prague at adudik@bloomberg.net; Radoslav Tomek in Bratislava, Slovakia at rtomek@bloomberg.net

To contact the editors responsible for this story: James M. Gomez at jagomez@bloomberg.net Andrea Dudik, Michael Winfrey


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