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May 2009

Eastern-Europe - Monthly political report

There was only a limited campaign in the ten EU-member countries of the region, and even this was dominated by internal issues. Other elections were held as well: in Lithuania Grybauskaite scored a sweeping victory at the presidential elections, while in Croatia the opposition celebrated a slight victory at the local elections. In Yerevan there was no surprise at the city elections. In the Czech Republic the new government was formed, while in Estonia the incumbent one collapsed. The Prime Minister of the Bosniak-Croat Federation also resigned. In Moldova the Parliament, elected in April, had to be dissolved because of the unsuccessful presidential election. In Slovenia and Slovakia corruption cases affected the popularity of the junior governing parties. In Bulgaria the 'gauntlet' of the Blue Coalition continued. Minsk split with Moscow.

During the month the new Moldovan parliament held its first sitting, but its term lasted only for a month. The opposition sabotaged the presidential election, so the legislature had to be dissolved and new elections will be called for. The governing communists nominated the Prime Minister, Zinaida Greceanii for president, while the incumbent Vladimir Voronin received the position of parliamentary speaker, a position that will allow him to exert his influence later on. The Communist Party which was hoping to get the one vote necessary to elect the new president from the opposition, offered negotiations to the three opposition parties, but those declined the offer. The early elections will be held in August or in September if Voronin issues the necessary order. The Czech parliament also decided - officially - to hold early elections, after the interim government of Jan Fischer was formed. The Social Democratic Party supported the cabinet only on the condition that the house of deputies cancelled the majority of the health care fees. During the EP-campaign, flawed by egg-throwings, the Upper House also ratified the Lisbon Treaty, now the next obstacle is the President, Václav Klaus. The congress of the Christian Democratic Union was also held, where the former finance minister, Miroslav Kalousek left the party, and Cyril Svoboda, the former minister of regional development became party chairman. European issues were brought up in Poland as well (quite unlike most countries in Eastern Europe). The opposition Law and Justice is becoming stronger despite the scandal around its party lists. The two main parties were debating mainly the distribution of European positions. The constitutional court declared a tie in the debate about the foreign policy powers of the President and the Prime Minister, but the President has recently been more and more involved in economic matters as well. The President criticized the anti-crisis steps of the government, based mainly on flexible work-time, and it is almost sure that Lech Kaczynski will want to have a say in the debate about the newest anti-crisis package, due in July or August. The anti-crisis package was drafted in Macedonia as well, but, according to the finance minister, the country still does not need an IMF-credit. Foreign policy issues dominated the month: the ethnic Albanian Democratic Union for Integration gave a half year ultimatum to the Prime Minister to resolve the name-dispute with Greece. What is more, the coalition was also shaken by a cancelled visit of Kosovo’s President Fatmir Sejdiu because Sejdiu would not have been greeted with stateliness. As a result, the Macedonian Albanians also started protests. The former president, Branko Crvenkovski was re-elected as the leader of the opposition Social Democrats. Of course, the cancellation of Sejdiu’s visit was embarrassing for Kosovo as well, but the country scored considerable foreign policy victories as well: in May it became a member of IMF, and presumably, in June, the World Bank will also admit it. During the month, the governing coalition was finally able to elect the members of the constitutional court and the ombudsman (Sami Kurteshi). No date was found however for the autumn local elections (presumably they will be held in November). Meanwhile, riots broke out in Mitrovica again, this time because of the renovation policies of the town. Another important event was the visit of the American vice president Joe Biden, which was meant to strengthen the state in Kosovo and in Bosnia and Herzegovina as well. The latter does need this: the Prime Minister of the Federation, Nedzad Brankovic resigned, surrounded by alleged corruption cases, and after his Party, the Democratic Action, re-elected his rival, Sulejman Tihic as party chairman. What is more, Brankovic had done this before the parliament could have adopted the new anti-crisis measures, necessary to acquire an extended credit of 1,2 billion dollars. Milorad Dodik, the Prime Minister of the other entity, Republika Srpska, continues his war against High Representative Valentin Inzko. Dodik is also surrounded by accusations of corruption, while Inzko - after having strengthened his international position - gave an ultimatum: should the RS not cancel the parliament’s resolution questioning the transfer of powers to the national level, he will use his unlimited powers of hiring and firing. The government collapsed not only in the Federation, the other crisis happened in Estonia. With the senior governing Reform Party not being able to agree with the Social Democrats on the labor and tax sides of the anti-crisis package, the Prime Minister Andrus Ansip sacked the three Social Democrat ministers. For a while, negotiations were conducted with the agrarian National Union (RL), but a junior governing party, the Union of the Homeland and Res Publica could not agree with RL on social budget cuts, so a minority government was formed, which will be supported by the Greens, and - to some extent - the RL also. Social cuts marked debates in Latvia as well. A 20% cut in teachers’ salaries, cutting back on premiums for working mothers, and the brutal cuts in costs affecting all ministries were still not able to get the budget deficit under 7%, its being just above 9% for the time being, so the country will need another round of cuts. This was one of the reasons why the finance minister Einars Repse received full powers in withholding budget sources. Together with the EP-campaign ran the campaign of the local elections, the crescendo of the left-wing is expected here as well. The situation is not so obvious in Croatia, where local elections were held on the 17th May. The senior governing Democratic Union won in the majority of the counties, but it could not hold on to its positions in cities. Zagreb remains under Social Democratic control, although a considerable inner-party debate can be expected on the coalition in the capital. Unions were protesting before the elections, but the government was able to come to an agreement with them, unlike in the case of students protesting for free education. The Slovenian border dispute was not solved either, although Croatia accepted the proposals of enlargement commissioner Olli Rehn. Slovenia, on the other hand, requested amendments, so it was not adopted. Meanwhile, the shadowy loans of Nova Ljubljanska Banka and their threads leading to the junior governing Liberal Democrats and Zares caused a public uproar. This caused the chairman of the bank, Darko Veselinovic to resign. The month of May saw the election of Radovan Zerjav as the new chairman of the opposition People’s Party, while the opposition Democratic Party and the junior governing Pensioner’s Democratic Party re-elected their leaders. Corruption cases dominated in Slovakia as well. The junior governing radical right-wing National Party saw two of its ministers leave the government in only two weeks, which seriously damaged the party’s image. In May, the environment minister, Jan Chrbet had to leave because of a disputed business of selling quotas. While the justice minister Stefan Harabin came to attention because of his candidacy for the Supreme Court, protests occurred against the dissolution of the anti-corruption Special Court. The senior governing Smer offered a compromise in this case. Another important issue besides the growing deficit of the social security and the state pension fund and the planned widening of the tax base was the statement of Viktor Orbán, the head of the leading opposition party in Hungary about the Hungarians in the Carpathian Basin. The Slovak parliament disapproved of the words of Orbán.

The Lithuanian government may soon be reshuffled as well. Dalia Grybauskaite, landslide winner of the presidential election on the 17th May signaled that she is dissatisfied with several ministers, and the constitution also prescribes the nomination of a new government after presidential elections. The president-elect also called for tax changes for small- and medium-sized enterprises, and she will initiate the dissolution of the joint-stock company Leo LT. The parliament, meanwhile, adopted the higher education reform, which reorganizes the financing of universities and students. The new Montenegrin government is about to be formed as well. The Prime Minister Milo Djukanovic was again nominated for the position (unsurprisingly) by the President Filip Vujanovic, however the question of Djukanovic’s possible heir emerged. Within the governing Democratic Party of Socialists the fight is between finance minister Igor Luksic and the vice-chairman of the party Svetozar Marovic. Luksic seems to be in the lead as new deputy-PM, but he should look out for Marovic as well. Meanwhile, the situation of KAP, the biggest employer of the country seems to be resolved if only for a while. The state and a Russian group will own the company together, and carry on the social program, worked out earlier. While the Montenegrin opposition was still negotiating about parliamentary positions, the public debate in Georgia was about the protests that have been going on for almost two months. A considerable part of the opposition leaders, i. e. Irakli Alasania agreed to hold negotiations with the government on constitutional reforms, while Nino Burjanadze and her followers continue to protest, although it is now quite obvious that the tactics based on civil unrest have failed. The security situation continues to be tense. Before the military exercise of NATO, a rebellion took place in a military barrack, and the separatist South Ossetia held parliamentary elections.

Meanwhile, the opposition was protesting in the neighboring Armenia as well, as on the 31st May local elections were held in Yerevan for the first time. Three party lists made it into the city assembly, two of which belong to the governing parties. The mayor will continue to be Gagik Beglaryan, the candidate of the senior governing Republicans. The main opposition party, the National Congress did not acknowledge its defeat. Another loser of the election was the Revolutionary Federation, which had quit the government just few weeks earlier. The positions of this party held in the government were distributed among young politicians of the three remaining governing parties. The neighboring Azerbaijan is preparing for a public administration reform as well, but details are not known yet (however it is sure that it will be a simplification of the structure). The tension within the country because the thaw between Armenia and Turkey is growing and the ministry of foreign affairs was utterly skeptical in commenting the forthcoming meeting of Armenian and Azerbaijani presidents in St. Petersburg. Islamic fundamentalism was also brought up as an issue because of the Baku university massacre in the beginning of May. Serbia also prepares to reform its system of public administration, but the reform is in its initial phase here as well. A consequence of the idea of the President Boris Tadic would be the reduction of the number of deputies in the parliament, but deputies from Vojvodina are not willing to agree with the splitting of the autonomous region. This causes considerable debates within the government, which may be reshuffled in the autumn according to the President. Meanwhile, the Hague International Court of Justice issued its utterly optimistic report about Serbia, but they signaled also that the extradition of Ratko Mladic and Goran Hadzic is necessary for Serbia to continue its process of integration.

Presumably, a government reshuffle is to be expected in Romania as well, after the EP-elections, as the grand coalition is on the verge of breaking up. The election is seen as a rehearsal for the autumn presidential election, in spite of the fact that President Traian Basescu still has not announced his intention to stand as a candidate. The first main debate between the two governing parties was about the method of decentralization, and its personal consequences, but three important draft laws of the judiciary reform caused bitter disputes as well. The Democrat-Liberals would tie these laws to a motion of confidence, while the Social-Democrats would amend them. If the dispute goes on for a long time, it will have a negative effect on the judiciary report of the European Commission about Romania. Presidential elections are also a topic in Ukraine, where the vote is expected to take place in October, although the constitutional court declared the date unconstitutional. In the background - again - a new coalition is about to be formed, to further curb the possibilities of President Victor Yushchenko, although the talks may fail on some issues, for example the resignation of the interior minister Yuri Lutsenko, whom the Prime Minister supports. The President lost another ally in his chief of staff, Victor Baloha, who resigned in May, and immediately turned against the head of state. The incapacity of the parliament continues to be a major obstacle to adopt anti-crisis measures, and it is far from sure that the country can settle its debts with Gazprom by the 7th June. Belarus may soon experience similar problems, after the President Aleksandr Lukashenka announced the break up of its country with Moscow. The problem was that Russia was reluctant to pay the second part of the promised loan to Belarus, and the Belarusian parliament was not willing to recognize the independence of South Ossetia and Abkhazia. The President, therefore, ordered the government to look for other economic allies, such as Kazakhstan. Earlier the finance ministry spoke about a VAT hike, but this was postponed. The law on amnesty was, however, adopted, which was an important gesture towards the EU before the May summit that decided on the Eastern Partnership.

The Bulgarian government was accused by the opposition of using authoritarian instruments similar to its Belarusian counterpart. The Blue Coalition of parliamentary right-wing parties was - after the threshold for coalitions was increased to 8% - almost torn apart by a dispute over the registration of the party for the European and Bulgarian elections. Many suspected the government to be behind the story, but the constitutional court later declared the new threshold invalid, and the registration was settled as well. The governing coalition adopted a number of important nominations in the parliament before the July elections - which it will certainly lose - to ensure its political survival. A positive event for the governing Socialists was, however, that the EU unblocked some of the previously frozen funds. Meanwhile, the campaign is under way in Albania as well. At the June elections, four coalitions will compete, out of which three have real chances to enter the parliament. The party of the Greek minority teamed up with the left-wing opposition at the last moment, and withdrew from the government. The start of the campaign was marred by ongoing disputes about the distribution of new IDs. The government, finally, was willing to ensure a greater transparency in this matter. The governing right will be campaigning mainly with infrastructural investments. At the same time however, the trial of those responsible for last year’s Gerdec blast was started which may throw light on the governing parties through investigation into arms trade of the 90s.

In June the Moldovan parliament will be dissolved, and a new Prime Minister will be chosen in the Bosniak-Croat Federation. Elections to the European Parliament will be held, which may have immediate effects on the Romanian government. A reshuffled government will be formed in Estonia and Lithuania. In Ukraine a new government may also emerge. The Armenian and Azerbaijani presidents will meet in St. Petersburg. Kosovo will become a member of the World Bank. The Bulgarian and Albanian campaigns will reach their peak. The spring sessions of parliaments will end.

Between the 4th and 7th June European Elections will be held in 10 countries of the region.

On the 6th June local elections will be held in Latvia.

On the 28th June parliamentary elections will be held in Albania.

EASTERN EUROPEAN OBSERVER, providing detailed coverage of political events in 23 countries each week, can be ordered both in English and in Hungarian by sending an email to info@visionpolitics.hu