Meciar treads "Slovak path"
International Viewpoint #261 November 1994
UNLIKE their richer Czech neighbours, Slovakia's would-be entrepreneurs are finding the introduction of capitalism difficult. In elections on 30 September-1 October, voters rejected a neo-liberal government in favour of one which claims to favour social reform and greater interventionism. A similar result in the 1992 Czechoslovak elections split the federation. ADAM NOVAK explains why the new government will be hard pressed to find an external scapegoat. A LTHOUGH they have never won an election, Slovakia's neo-liberal and Christian Democratic parties have twice profited from a split in the country's largest party, the broad centre-left Movement for a Democratic Slovakia (HZDS) of Vladimir Meciar, enabling them to form unpopular governments which pushed through market reform policies. Since forcing a vote of no confidence on 11 March, the "caretaker" government of neo-liberals, Christian Democrats, and the Party of the Democratic Left (SDL, former Communist Party) has tried to repeat the popular Czech privatisation by coupon. However, their reform crusade has been tarred by bureaucratic delays, and bogged down in accusations of corruption.
### Foreign aid
Nor did the foreign aid, which they said Meciar had frightened away, materialise. Since 1989 direct foreign investment has been only US$1.1 billion (20% of the per capita level of foreign investment in the Czech Republic). Unemployment is 14.5% nationally, and up to 20% in some regions (the Czech average is 4%). Although the economy has now recovered from the partition of Czechoslovakia on 1 January 1993, the economy is still weak, with Western advisers warning that the "inevitable" steps of restructuring are still ahead. The rightist government's decision to reduce 14
### SLOVAKIA petrol, diesel, potato and meat prices, announced the day before the election, failed to convince the population that quick reforms would bring results.
The party of former Privatisation Minister Ivan Miklos even failed to clear the 5% hurdle to enter parliament. As a result, the right wing parties would have to ally with the former Communists and either the Hungarian or the Slovak nationalist parties in order to have a majority. However, this would not give them a mandate for the reforms they wished to pursue. Moreover, it would oblige them to take sides in relation to the increasing national tensions between Slovak chauvinists and the compact Hungarian minority living along the southern borders.
The populist Movement for a Democratic Slovakia (HZDS), led by former premier Vladimir Meciar, maintained the support of one third of voters. In government and in opposition, Meciar had skilfully argued the need for interventionist, state capitalist policies. Almost alone on the Slovak political scene, he opposed the neo-liberal policies forced on Slovakia by the main Czech parties which dominated the former federation.! Rightly, Meciar predicted that the uncontrolled market would be a disaster for Slovakia, industrialised only under the Stalinist regime, home to most of Czecho-Slovakia's heavy industry, and heavily oriented to Eastern customers. He was ostracised for his criticism of President Vaclav Havel's 1990 decision to abandon Czechoslovak arms production (2/3 of which was based in Slovakia).2 HZDS's demands for a "Slovak path" in economic policy was particularly popular in small towns and villages,3 and among workers and older people.
Meciar has built the image of a nationalist leader, suspicious of the market and foreign capital. In fact, his economic policies are broadly similar to those applied in neighbouring Poland Hungary and the Czech Republic, and, in the case of the latter, he has done all he can to maintain the agreed customs union. The Czech Republic still takes over 30% of Slovak exports, mainly raw and semi-finished materials for re-working and re-export to the West. And his decision to devalue the Slovak koruna
(Kcs) by 10% against the Czech, when the currency union fell apart in February 1993, is now accepted in business circles, who predict a Kcs15 billion surplus in trade with the Czech Republic this year, leaving the country with a manageable global trade deficit of only Kes1 billion.4 The devaluation is a continuation of the 45% devaluation in 1990, which placed Czecho-Slovak wages at 3/4 of Polish or Hungarian levels. Such destructive competition is not just a sign of weakness, but the logical conclusion for central European countries with similar industrial structures bidding against each other for limited Western orders on the basis of one cost advantage: a skilled and unorganised labour force.
Though social expectations will be higher under Meciar, his policies are essentially the same as those of his neoliberal critics, presented in an authoritarian and paternalistic, rather than technocratic style.
The left
The conflict between Meciar and the right had, until these elections, favoured the moderate Party of the Democratic Left (SDL), which has transformed itself from being the former ruling party into a broad democratic party, supported by former Communist party members and others who reject the current reforms.S Yet while the left as a whole increased
1. In 1991, Czechoslovakia had a population of 15.7 million: 10.3 million in the Czech Republic and the rest (including 530 thousand ethnic Hungarians) in Slovakia.
2. Arms sales represented about 12% of Czechoslovakia's hard currency earnings in the late 1980s. Had sales continued at the same rate, arms would now account for 20% of Slovak foreign currency earnings. While the highly-profitable Czech arms industry was re-launched after independence, Slovakia's tank factories are silent. Some have been stripped of their equipment, others are engaged on ill thought-out conversion programmes imposed on them by French, British and American NGOs, using funds provided by the very governments which have taken the place on the world arms market which Slovak products used to fill.
3. 3/4 of the population live in towns with under 50 thousand inhabitants.
4. Exports this year will exceed Kcs116 billion.
5. This transformation, based on re-registration, required members to make an active choice to remain in the party, combined with a purge of Stalinist leaders. However, there is tolerance for Stalinist members. The party's social democratic policy has been imposed by an young and articulate new leadership.
currency reserves.
US$1 = Kcs34
International Viewpoint #261 November 1994 its vote in these elections, the SDL paid a high price for its participation in the anti-Meciar government, and the consequent reduction of its policies to support neo-liberal economic reforms in exchange for a slightly more generous social policy, and greater support for important businesses in financial difficulty. Having received only half of the votes they expected, ex-Stalinist deputies, such as Pavol Kanis, are considering reversing the social democratic policies of party leader Peter Weiss, and entering a coali-
PARTY
Association of Workers (ZRS)
Common Choice (mainly SDL)
Mvmt. for a Dem. Slovakia (HZDS)
Christian Democrats (KDH)
Democratic Union (DU)
Slovak National Party (SNS)
Hungarian Coalition
Lists receiving less than 5%
1992(%) 1994(%)
SEATS
7.3
13
14.7
10.4
18
37.3
35.0
61
8.9
10.1
17
8.6
15
7.9
5.4
9
10.2
17
13.1
Total participation in election: 76% of registered voters (voting is not compulsory).
tion with the HZDS, which they consider to be less democratic, but more social minded than the outgoing rightist government of Jozef Moravcik.
Fortunes
The fortunes of social democratic parties have been reversed before. What is worth noting in Slovakia is that the
THERE are both Hungarian and Slovak nationalist parties in votes lost by the SDL went not only to
Slovakia. Their actual and potential role is quite different.
the vague centre-coalition of Meciar, but
Three nationalist and Catholic parties mobilise over 90% of also to the "Workers Association of Slothe votes of the largely-rural ethnic Hungarian minority (12% vakia" (ZRS), formed only this spring, of the population) in the south of the country. They seek to which took 7.4% of the vote and 13 of defend the extensive minority education and language rights the 150 seats. A spontaneously formed introduced under the Stalinist regime, and now threatened by coalition of groups of frustrated older each successive goverment in Bratislava. As the climate of workers, the ZRS mixes workerist and intolerance increases, minority leaders are more vocal in their populist demands, combining an absoludemands for autonomy. Until these demands are met, there will be little possibility for organising Hungarians on anything te rejection of factory closures and price other than a national basis.
rises with reactionary demands - for example, a law "to outlaw unemploy-
The Slovak National Party is quite different. Their nostalgia ment, and punish the feckless",
•and for a mythical Slovak past, and fascination with the puppet measures to restrict the use of the Hunfascist state of 1938-1944, means little to most urban Slovaks. Blaming Hungarians and Czechs for all the country's ills garian language in ethnically mixed souhas won them a place on the margins of parliamentary life, thern districts.
but they are hardly the dominant force the foreign press says
This volatile formation is of crucial they are. The far right as a whole is less popular than in the importance in the development of a neighbouring Czech Republic. O democratic and socialist opposition to market reforms. On the one hand, the ZRS is so
Economic Situation unstructured that, even if the leadership
• Redistribution in the federal budget made up 7% of the Slovak budget in absorbed into is exclusively parlia-
• In the twelve months to June 1994 mentary activity, and the late 1980s.
becomes more modera-
GDP increased by 4%, almost cancelling the decline following the natiote, each strike and social polarisation will throw nal partition (4.5%).
up new radical leaders
• Industrial production has increased for the Association on a by 15%, but construction is 6% down.
local level. But unless a
• Inflation is currently at 13.5%.
group of leaders are able
• Budget deficit of Kcs10.6 billion.
to articulate alternative
Servicing of the State debt will cost policies, rather than short
12.6 billion this year, 42 billion in term defensive demands,
1995. Foreign loans make up 40% of the association could drift towards the "red-brown" realignment of nostalgic Stalinists and the extreme right, represented by the Slovak
National Party (SNS). *
----- pull-quotes on this page -----
Nationalism 15