Identifier
Created
Classification
Origin
05LJUBLJANA509
2005-07-20 05:01:00
CONFIDENTIAL
Embassy Ljubljana
Cable title:  

LUNCH WITH SLOVENE PRESIDENT JANEZ DRNOVSEK:

Tags:  PREL PGOV ECON SI 
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This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L LJUBLJANA 000509 

SIPDIS


DEPT FOR EUR/NCE

E.O. 12958: DECL: 07/18/2015
TAGS: PREL PGOV ECON SI
SUBJECT: LUNCH WITH SLOVENE PRESIDENT JANEZ DRNOVSEK:
JANSA'S MISTAKES AND STRUGGLE WITH HIS COALITION


Classified By: COM Thomas B. Robertson for Reasons 1.4 (b) and (d)

C O N F I D E N T I A L LJUBLJANA 000509

SIPDIS


DEPT FOR EUR/NCE

E.O. 12958: DECL: 07/18/2015
TAGS: PREL PGOV ECON SI
SUBJECT: LUNCH WITH SLOVENE PRESIDENT JANEZ DRNOVSEK:
JANSA'S MISTAKES AND STRUGGLE WITH HIS COALITION


Classified By: COM Thomas B. Robertson for Reasons 1.4 (b) and (d)


1. (SBU) Summary: At Lunch with COM July 18, President
Drnovsek focused largely on domestic issues including the
Government of Prime Minister Janez Jansa and what seems to be
the biggest obstacle (his coalition partners) to needed
economic reform and potential foreign investment; the current
disarray within the leading opposition party, Liberal
Democracy (LDS); the expected referendum on RTV Slovenija;
the painful path to WWII reconciliation; and the potential
fallout from proposed legislation that would abolish the
Corruption Prevention Commission. He was also very much
looking forward to his upcoming vacation in the Carinthian
Alps (Austria). Drnovsek seemed to think his foreign affairs
advisor and former Foreign Minister Ivo Vajgl would be a good
candidate to lead his former party, the LDS, back to its
rightful place on the political scene, and Vajgl did not
appear averse to moving in that direction if the political
support is there. End Summary.

2.(SBU) President Janez Drnovsek hosted COM at Vila Podroznik
for lunch, July 18, 2005. Drnovsek was accompanied by
foreign affairs advisor and former Foreign Minister, Ivo
Vajgl, and his chief of staff Valentina Hajdinak. COM was
accompanied by PolEcon Chief. Drnovsek welcomed the
Ambassador at the ceremonial residence of Vila Podroznik,
next door to the EMR. Drnovsek was his usual low-key self,
and he seemed in a good mood as he opened the lunch with a
joke about the Montenegrins, showing the years as part of
Yugoslavia are still integral to his world view today.


--------------
Jansa's Performance
--------------

3. (C) Drnovsek meets weekly with the prime minister and
says one of Jansa's greatest obstacles to reform is his own
coalition. Specifically, the Slovene People's Party (SLS)
disagrees with many SDS policies including privatization,
relations with Croatia, and foreign direct investment.
Drnovsek is very familiar with the challenges facing Jansa on
this score as he, too, headed a government coalition with SLS
as a partner. Having the pensioner's party as another

coalition member does not promote the case for
"revolutionary" change either. Drnovsek said he knew how hard
Jansa was working and suggested he might be tying to do too
much himself. This was in part a reflection of the
weaknesses in his coalition especially on the economic front.


4. (C) COM asked Drnovsek what he thought about the current
legislation working its way through parliament that would
abolish the Corruption Prevention Commission (CPC). Drnovsek
agreed that the CPC was doing good work and he said he was
surprised that Jansa was cooperating with the right-wing
Slovene National Party (SNS) in proposing the CPC's
abolishment. Drnovsek said that when originally created, the
CPC was meant to be an independent office, but within the
Ministry of Interior. Now that it had been made an entirely
independent agency, it would be very difficult to put it back
under government or parliamentary (as is being suggested)
control. Aware of Jansa's problems with CPC Director Kos
personally, Drnovsek suggested, it might be more effective to
try to get rid of Kos. That approach is filled with a
different set of legal obstacles as well.

--------------
Referendum: a Losing Prospect for All
--------------

5. (C) As Drnovsek described it, Jansa is making mistakes
one might expect from a new government, but that he had hoped
would be avoided. He worries that the new GOS has decided
that with its new-found power, it will do what the LDS did
well for so long - propose legislation, institute structural
changes and not bother to consult the opposition. As an
example, he remarked that the RTV legislation recently
debated in Parliament and which will now be the subject of a
referendum, could have been easily negotiated with the
opposition. The referendum, Drnovsek said, is regrettable
and will only deepen the discord between the parties and make
bipartisan cooperation even more difficult in the future. In
his time as prime minister, Drnovsek said he had always made
a point of listening to the opposition and accepting some of
its proposals, however, Jansa seems to be making a point of
rejecting all overtures of the opposition. Vajgl, reminding
us he had once been a journalist for RTL, suggested the LDS
did not have a history of influencing the press, which


Drnovsek quickly contradicted, noting how involved Kucan had
been in manipulating the press. He added, since he (Drnovsek)
had often been the target of sharp press criticism, how
envious he was of Kucan's Teflon image with the press

--------------
Managing the Economy
--------------

6. (C) On the economic front, Drnovsek commented that he had
seen no evidence of progress from the Government on reform.
He noted that Jansa's talent pool was very shallow, and that
he was not impressed by the abilities or performances of
either the Minister of Economy or Finance. Having counseled
Jansa to move in the first part of his mandate to do the
difficult job of privatization, Drnovsek remarked it would be
a tough sell. His own experience partially privatizing
leading bank Nova Ljubljanska Banka was a very rocky time.
Drnovsek claimed that LDS and SDS really were not far apart
on the privatization issue, but under former PM Rop's
leadership, LDS had really lost its liberal (in the European,
economic sense) ways. Drnovsek thinks the state can divest
itself of its position in the banks in other ways, including
through the pension and restitution funds it manages. Beyond
that, and betraying his "go slow" inclination, Drnovsek
thought privatization needed to be done on a case-by-case
basis.


7. (C) Lamenting that Slovenes are very conservative on
foreign investment and worried about loss of Slovene national
interest, Drnovsek complained that there seemed to be no-one
willing to speak out publicly and in favor of the benefits of
foreign direct investment. He said he was willing to do so,
but politically, it is considered a no-win position.
Drnovsek confirmed that he considers Scandinavia (i.e.
Finland) the best suited model for Slovenia to follow
economically - an innovative economy with a strong social
safety net. He was not enthusiastic about the flat-tax idea
that has been floated by the GOS, saying it is unlikely to
gain much support and there are other ways to improve the
system that would be effective and more palatable to the
Slovene public.

--------------
New Leadership for LDS
--------------

8. (C) When COM asked Drnovsek what he thought about the
current state of affairs within the LDS, he suggested maybe
the solution was sitting at the table - Ivo Vajgl, as
candidate for the LDS presidency. Vajgl, clearly flattered,
didn't brush it off. He said he was, indeed, talking to
people but he hadn't been asked to run for the Presidency of
the LDS. Drnovsek clearly supports this idea, and had a good
laugh over it saying sotto voce to the Ambassador that he
didn't envy Vajgl. As to who might "ask" Vajgl to run, both
agreed strongly that it would not, and should not be Rop.
That link would surely undermine Vajgl's chances. Should
Vajgl choose to run for the leadership spot in LDS, it was
not clear in this conversation if he would immediately resign
from the President's staff.


9. (C) Both Vajgl and Drnovsek agreed that Rop had done great
disservice to the LDS by moving it away from it's traditional
center position and adopting strongly left-leaning policies.
Drnovsek seems to believe that with the right leadership, LDS
can regain the center and that a grand coalition with the SDS
would be possible - and results would be much better than
with the current coalition. Vajgl said that in fact, at the
time of last year's elections, at least half of LDS was
willing to seriously consider going into government with SDS
- something Jansa had publicly been willing to explore.


-------------- ---
Reconciliation - Still Sensitive 60 Years Later
-------------- ---


10. (C) The Ambassador thanked Drnovsek for the very
thoughtful letter he had written to President Bush after the
Moscow WWII commemoration events. He noted that since their
last meeting, both the President and PM Jansa had made strong
speeches about the need for reconciliation between the
supporters of the opposing factions during the war in
Slovenia - Domobranci (seen as collaborators) and Partisans
(reviled as Communists). Drnovsek said it was important to
continue the process of reconciliation in Slovenia and that
Jansa and he had begun a very public push in two speeches


early this summer. Nonetheless, prejudices, which by now are
one or two generations removed from the events, die hard.
Drnovsek noted that Justin Stanovnik, brother of Partisan
leader Janez Stanovnik and himself a former Domobranec, had
been critical of Drnovsek's remarks since he had only blamed
the "revolutionary leadership" for the excesses against the
domobranci and not all partisans and communists.

--------------
Comment
--------------


11. (C) Drnovsek, clearly looking forward to his vacation
when he could "clear his head of politics" was warm and
congenial in this meeting. Though Drnovsek often comes
across as passive and very quiet -- he is almost painfully
deliberate in his answers -- he was engaged in our
discussions. what was striking in this meeting was his
assessment that Jansa is missing important opportunities to
make reforms and that he has made mistakes by not being
willing to work with the opposition. With former PM and LDS
president Rop on the ropes, Drnovsek clearly sees an
opportunity for his former party to revive and return to its
liberal economic roots -- perhaps under Ivo Vajgl's
leadership. More intriguing is the idea that LDS at some
point in the not-too-distant future might be a more
productive coalition partner for SDS that the team Jansa has
now.
ROBERTSON


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2005LJUBLJ00509 - Classification: CONFIDENTIAL



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