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President's eco-plan seen as meddling

Economic experts have given a cautious welcome to President Rudolf Schuster's February 14 request to former central bank governor and current Deloitte & Touche Slovakia President Vladimír Masár and head of the Slovak Chamber of Commerce Peter Mihók to draw up an economic "vision for development" of the economy for the next 15 years.
While the necessity for such a plan was questioned by the Office of the Deputy Prime Minister for Economy Ivan Mikloš, macroeconomic experts said any large-scale economic policy initiative was good if kept on an independent basis. They did warn, however, that such ideas ran the risk of overlapping with the government's, and especially Mikloš's, current economic policy concepts.


President Rudolf Schuster has asked two prominent business figures to script a long-term economic plan; analysts ask why.
photo: Ľuboš Hrivčák

Economic experts have given a cautious welcome to President Rudolf Schuster's February 14 request to former central bank governor and current Deloitte & Touche Slovakia President Vladimír Masár and head of the Slovak Chamber of Commerce Peter Mihók to draw up an economic "vision for development" of the economy for the next 15 years.

While the necessity for such a plan was questioned by the Office of the Deputy Prime Minister for Economy Ivan Mikloš, macroeconomic experts said any large-scale economic policy initiative was good if kept on an independent basis. They did warn, however, that such ideas ran the risk of overlapping with the government's, and especially Mikloš's, current economic policy concepts.

"Theoretically, it could bring something positive. These kind of plans should be prepared by an independent institution, which, for example, Deloitte & Touche is," said Marek Jakoby, an analyst with Bratislava economic think tank Mesa 10.

"But this is definitely the turf of the Deputy Prime Minister for Economy, who has also presented a mid-term economic development policy. If I was him [President Schuster] I wouldn't do it. This initiative could be taken as another criticism of the government. The president is saying that a conception, which [he believes] isn't there, should be there," Jakoby added.

The head of state, a former top-level communist, has criticised Mikloš's economic plans on previous occasions. In May last year, Schuster openly criticised coordination between the deputy prime minister's office and other government bodies over OECD entry. However, in July Slovakia was invited to join the international trade organisation. At the time, Mikloš refused to comment on the president's criticism.

Mikloš's office said after news of the president's latest request that a long-term conception for development of Slovak economic policy was not needed, as the office had already, in cooperation with other ministries, drawn up economic plans through to 2005, one year after the country is expected to enter the European Union.

"I cannot think of any reason for the president's initiative. The president [often] expresses disatisfaction, speaks about the revival of the country's economy, but never comes up with concrete proposals," said Vladimír Tvaroška, an advisor to Mikloš.

"We have come up with a mid-term economic programme [implemented in 1999 and revised in 2000] and are currently working on a pre-EU entry economic programme. This document, which is expected to be approved at the end September, is the key concept we are working on this year. I don't think that at this point there is a need for a long-term concept," he added.

But according to former NBS head Masár, despite the criticism from Mikloš's office there is a real need for his and Mihok's work. "We think that such a long-term policy analysis is necessary. It's 11 years after the Velvet Revolution, and no such conception has been drawn. It's sad," he said.

However, Ľudovit Ódor, analyst at ČSOB bank, cast doubt on Masár's assertion. "A long-term economic concept is a good thing, but at the moment it would be better to focus on the mid-term horizon," he said.

Longer term policy called for

While cabinet rubber-stamped the mid-term economic development after coming to power in 1998 to cover the period up to and one year beyond EU accession, the Ministry of Economy has also drawn up several five year economic plans for industry development.

However, Schuster's request to Mihók and Masár has called for a much longer-term conception that would extend beyond a decade. Schuster said in early February 2000, during a visit to the VW Slovakia car manufacturing plant outside Bratislava, that while there were people who could draw up long-term economic plans, there was not the will to do so in government.

"We have the ability to plan the future of this state for several decades, but we are just afraid of thinking about what will happen in 8 to 12 years time," he said.

According to Masár, his talks with the president on the scheme so far have focused on economic projects which would be realised beyond a single government's term of four years.

"We were talking about highways. The former government [of Vladimír Mečiar, 1994 - 1998] set a fast tempo for their construction, and the current government has slowed down with the project. Basically, the main aim of our programme is to link these long-term plans over several election terms," Masár said.

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