CSIS New European Democracies Project
Volume 3 ¦ Number 16 ¦ April 28, 2006
Central European Update Hungary The Hungarian Socialist Party (MSZP) won the second round of general elections, gaining 190 parliamentary seats. The main opposition party, the center-right FIDESZ gained 164 seats, the liberal SZDSZ 20 seats, the conservative MDF 11 seats, and the independent movement Somogyert 1 seat. The votes of Hungarians outside the country have not yet been counted and final results are expected on 28 April. Coalition talks between MSZP and SZDSZ have already began. The candidate for Prime Minister Ferenc Gyurcsany said that the parliament could begin its session in mid-May and the government in mid-June. Since the fall of communism, Hungarian voters have reelected a ruling party the first time. SZDSZ president Gabor Kuncze stressed that his party will enter the coalition if reform plans could be agreed upon in healthcare, public administration, education, the economy, and social policy. He noted that it is essential that government and opposition parties cooperate on urgent issues. ¯ ¯ ¯ Poul Nyrup Rasmussen, President of the Party of European Socialists (PES) of the European Parliament congratulated Ferenc Gyurcsany for MSZP’s election victory. He pointed out that after the Italian and Hungarian elections, Socialist parties are now present in governing coalitions of 13 EU countries. ¯ ¯ ¯ Germany's JC Neckermann plans to build a biodiesel plant in southwest Hungary, near the city of Baja. The plant will produce biodiesel from rapeseed, which requires the construction of a rapeseed mill. Other investors building biodiesel plants in Hungary include the US-
based CSLM Group, which plans a plant in northeast Hungary and one in southwest Hungary, and a consortium of Duna Fejlesztesi and United Biofuels Holdings. Duna Fejlesztesi, which is jointly owned by Hungary and Austria, will build a plant capable of producing 80,000-100,000 tonnes of bioethanol a year and is participating in the construction of six other biodiesel plants.
Czech Republic A Czech anti-terrorist unit has been operating in remote areas of Afghanistan, scouting the terrain and preparing to support a larger military contingent. This will be the second tour of an anti-terrorist unit participating in combat missions. Currently there are two other Czech contingents in Kabul involved in humanitarian aid and peacekeeping. ¯ ¯ ¯ The Czech state-owned Skodaexport engineering company is launching a harbor modernization project with the Indian infrastructure corporation Andhra Pradesh. The contract worth USD 1 billion envisions the modernization of Nizampatman harbor in the Bay of Bengal. ¯ ¯ ¯ The Czech engineering firm Wikov Industries (WI) has decided to expand its production of wind power plants to meet the rising demands of both Czech and foreign investors. A total of USD 20 million will be invested in the current production plant and the company plans to target foreign markets in Asia and other developing nations.
Poland Polish Prime Minister Kazimierz Marcinkiewicz met his Croatian counterpart Ivo Sanander to discuss Croatia’s bid for joining the
EU and NATO. The meeting was held on 26 April in Warsaw, and Marcinkiewicz voiced his support for Croatia’s Euro-Atlantic integration by offering to share Poland’s experience with the membership process. ¯ ¯ ¯ The world’s largest news agency Reuters is planning to open a data center in Gdansk. The center will process information from capital markets and companies aroun the world, together with macroeconomic data from banks and financial institutions. Reuters chose Gdansk due to the presence of highly qualified personnel and university graduates proficient in many foreign languages. ¯ ¯ ¯ Polish arms manufacturers are presenting their products in Kuala Lumpur this week, where they expect to sign multi-million dollar contracts with the Malaysian defense ministry. The largest Polish arms manufacturer Bumar already signed a USD 370 million deal with Malaysia last year for supplying their armed forces with PT91 tanks. Bumar equipped Iraqi forces with Sokol helicopters, Dzik armored vehicles, and light infantry weapons.
percent of those surveyed, whereas current Prime Minister Mikulas Dzurinda is behind Slota with one percent. ¯ ¯ ¯ According to a poll conducted by Transparency International Slovakia (TIS), living standards, unemployment, health care, and corruption are the top four problems Slovak society is facing. About 82 percent of those questioned believe that corruption takes place in the public procurement process. TIS has pressed Slovakia’s political parties to focus on anticorruption programs ahead of the June general elections. ¯ ¯ ¯ German car manufacturere Volkswagen might extend the production of its popular Polo brand to Bratislava. The head of Volkswagen’s board of directors, Thomas Schmall, said that the VW Bratislava facility had an excellent chance of gaining the contract. However, the new production line would not result into the creation of new jobs since the factory recently hired several hundred people. Volkswagen intends to close down its factory in Spain.
Slovakia According to latest polls, Vladimir Meciar, head of the opposition party Movement for a Democratic Slovakia (LS-HZDS), has become more popular than Slovak President Ivan Gasparovic. However, the Smer party chairman Robert Fico remains the most popular politician. Fico was supported by 26.5 percent of respondents, Meciar by 12 percent, and Gasparovic by 11.8 percent. Jan Slota, leader of the n o n -p a r l i a m e n t a r y u l t r a nationalist Slovak National Party (SNS) received support from 7
Featured Photo: Kõszeg, Hingary
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Select Briefing Europe East
Baltic States Update Latvia On 20 April Latvian Prime Minister Aigars Kalvitis inaugurated the Latvian Embassy in Tokyo, Japan. Kalvitis asserted that the Embassy will help expand political, economic and cultural contacts between the two countries. Cooperation with Asian states is becoming more important in Latvian foreign policy and this is the second Latvian diplomatic mission to open in East Asia. ¯ ¯ ¯ Top officials from the Latvian Ministry of Defense and Foreign Affairs attended a conference in Croatia assembling representatives from the U.S., the Adriatic Charter countries, and the Baltic states. NATO enlargement and transformation and the Euroatlantic integration of S.E. Europe were among the main topics of discussion.
Lithuania On 25 April Lithuanian lawmakers adopted amendments to the national constitution that were required for euro adoption. As a result, the Lithuanian Central Bank will no longer
have the exclusive right to issue money. The European Central Bank (ECB) will issue euro banknotes, and the Lithuanian bank will issue euro coins. Another change is the ECB’s requirement that central bank governors must be independent. Lithuania hopes to join the euro zone by January 1, 2007. It currently meets all of the requirements except the permitted level of inflation. ¯ ¯ ¯ On 25 April Lithuanian President Valdas Adamkus arrived in Yerevan, Armenia to meet with President Robert Kocharian. The leaders discussed Armenian-Lithuanian relationships, Armenian-EU cooperation, and several regional issues. The two sides also signed an agreement on stimulating investments.
Estonia On 27 April Estonian Finance Minister Aivar Soerd informed EU Financial Affairs Commissioner Joaquin Almunia that Estonia has given up the aim of adopting the euro on January 1, 2007 and will postpone the process by at least a year. Tallinn is not realistically able to meet the
required inflation criteria. Local analysts believe that the decision will not cause economic setbacks for the country. ¯ ¯ ¯ Eurostat, the European Union’s (EU) statistical office, reported that Estonia has the smallest public sector debt and one of the largest budgetary surpluses among EU countries, which is a testament to the government’s effective budgetary policy. Finance Minister Aivar Soerd also said that Estonia’s foreign debt is declining and that its reserves are increasing. ¯ ¯ ¯ On 26 April Estonia’s Ambassador to France Andres Talvik and Ambassador of the Republic of Congo Henri Marie Joseph Lopes established diplomatic relations between the two countries. The Estonian foreign ministry announced that EU-African relations and regional policy were also discussed. The Republic of Congo is currently President of the African Union and a non-permanent member of the UN Security Council.
Southeast European Update Bulgaria On 28 April U.S. Secretary of State Condoleezza Rice and her Bulgarian Foreign Minister Ivailo Kalfin signed an agreement on joint use of military bases on Bulgaria’s territory. The pact, which took two years to negotiate, will allow for the deployment of 2,500 U.S. troops on a rotational basis. The agreement will cover a 10year period, during which U.S. and Bulgarian units will enhance military cooperation and conduct joint exercises. The United States plans to use four sites in Bulgaria to establish small, flexible bases in close proximity to conflict regions. The locations are the Bezmer and the Graf Ignatievo air bases, the Novo Selo training area, and storage facilities near Aitos. The first U.S. troops will be deployed by the end of 2006. Bulgarian officials stated that the deal will help with Bulgaria’s military reform and improve both the economy and the regional security. ¯ ¯ ¯
On 27-28 April, Sofia hosted 34 foreign delegations for the annual informal meeting of foreign ministers from NATO member and partner states. The leaders held informal consultations to prepare the agenda for the upcoming NATO summit in Latvia in November.
Croatia On 25 April Croatian press announced that a contract for the construction of the pan-European oil pipeline (PEOP) Constanta Pancevo - Omisalj – Trieste will be signed within a month. The PEOP corridor will run through the territories of Romania, Serbia, Croatia, Slovenia, and Italy and it will carry Caspian oil to Western Europe. The pipeline’s construction would begin in 2007 and could result in about USD 1.5 billion of economic benefits for Croatia.
Romania The Romanian government announced on 26 April a delay in the privatization of the last state owned bank, the National Savings Bank, Casa de Economii si Consemnatiuni (CEC). The government’s
decision comes after a year of low bids for the purchase of the bank. The Romanian government will extend the deadline for the privatization of the bank until June or July 2006 and accept new offers for the remaining 69.9 percent of CEC. ¯ ¯ ¯ On 26 April Romanian President Traian Basescu delivered an opening address at the annual meeting of the Black Sea Economic Cooperation Organization (BSEC) in Bucharest. Basescu said that Romania has no intention of becoming the sole leader in the Black Sea region and it needs to partner with all other states in the region. He called for improved dialogue and cooperation within a non-institutionalized context. Basescu also announced that Romania will host on 5 June a meeting of the Black Sea Forum for Dialogue and Partnership, which will focus on organized crime and international terrorism.
survey shows a decrease in public support for the government’s initiatives. According to the poll, 41.1 percent of Slovenians back Prime Minister Janez Jansa’s cabinet, which is 6.5 percent less than the number in March. Opposition to Jansa’s policies was expressed by 46.5 percent of respondents, while 12 percent remain undecided. The same survey showed that if elections were held now, the ruling Slovenian Democratic Party (SDS) would still win with 22 percent of the vote, followed by the opposition Liberal Democrats (LDS) with 14 percent. As Slovenia’s most popular politician, poll respondents identified President Janez Drnovsek.
Slovenia On 23 April Slovenian channel POP TV reported that a recent
Featured Photo: Sneznik, Slovenia
Select Briefing is produced by the New European Democracies Project, formerly the Eastern Europe Project, at the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. The CSIS New European Democracies Project monitors daily developments throughout the East, Central, and Southeast European regions. This publication highlights news in the new European Union (EU) member states, as well as in the countries scheduled to join in the next rounds of EU enlargement. Select Briefing team: Janusz Bugajski, Director; Ilona Teleki, Deputy Director and Fellow; Milena Staneva, Research Associate and Editor of Select Briefing; and Research Interns Besian Boçka, Julie Jaffarian, Natalia Soczo, Maria Toshkova, and Ieva Vilutyte. © 2006 by the Center for Strategic and International Studies .