PARLIAMENTARY ELECTIONS: MARGINAL IMPACT ON

C O N F I D E N T I A L SECTION 01 OF 02 LJUBLJANA 000421 SIPDIS STATE FOR EUR/CE E.O. 12958: DECL: 09/05/2018 TAGS: PGOV PREL ECON ENRG SI SUBJECT: PARLIAMENTARY ELECTIONS: MARGINAL IMPACT ON SLOVENIA'S FOREIGN POLICY REF: A. LJUBLJANA 313 ¶B. LJUBLJANA 347 ¶C. LJUBLJANA 367 LJUBLJANA 00000421 001.2 OF 002 Classified By: CDA B. Freden, Reasons 1.4 (b,d) Summary -------------- ¶1. (C) Slovenia's September 21 parliamentary elections will either continue PM Janez Jansa's center-right government or bring in one led by a center-left coalition. In either case, however, we expect Slovenia to continue its deep, strong relationship with the U.S., and its active engagement in the EU and NATO. Borut Pahor, the head of the Social Democrats and the would-be PM if the center-left is the group that can form a coalition, assured the Ambassador on September 3 that there would be no change in Slovenia's foreign policy if he were elected. Pahor stressed that Slovenia would be a "good member of NATO and the EU." He did not, however, allow himself to be drawn into a discussion of specifics and many on the center-left would like to see Slovenia withdraw its two military trainers from the NATO training mission in Iraq. Milos Ciric, a strategic advisor to some of the center-left parties, noted that Slovenia had had to pay a high cost for its recognition of Kosovo and thus a center-left government must "appease Serbia." Ciric also said that a center-left government would not/not follow through on the current government's plan to participate in the South Stream project. Neither coalition can be expected to push privatization much beyond its lethargic pace. End Summary. Differences on Iraq and South Stream -------------- ¶2. (C) Pahor said that the U.S. and Slovenia had had differences in the past on Iraq, and he predicted we would have differences again, which we would work through. Ciric subsequently explained to Emboff that a center-left government would withdraw the two Slovene soldiers with NTM-I. He contrasted Iraq with Afghanistan and Kosovo, where Slovenian troops would remain engaged. Stanislav Vidovic, MFA Security Policy Division Director, had previously told Emboffs that if the center-right government stayed in power, Slovenia would likely respond positively to our request that it increase its advisors with NTM-I from two to four (ref A). ¶3. (C) Ciric told Emboff September 11 that a center-left government would not/not sign a deal with Gazprom for South Stream. He added that Slovenia would have closer relations with Europe as the center-left politicos "do not like Russia." If the center-right government stays in power, we expect that it would sign a deal for South Stream by the end of the year, as the Minister of Economy discussed with the Ambassador in late July (ref B). But Limited Investment Opportunities in Either Case -------------- -------------- ¶4. (C) Pahor stated to the Ambassador that Slovenia needed to attract foreign direct investment, including from the U.S., but admitted that a center-left government would "go slower and seek consensus" by taking into account the views of organized labor. He claimed that he did not see a strong need for further privatization, but that a government under his leadership would look at privatization on a case-by-case basis. Pahor mentioned, however, that Slovenia must privatize its railroads, which would be an opportunity for FDI. The current government also has Slovenian railroads on its development program. In contrast to 2004 when the center-right called for greater privatization, when the Ambassador pressed Jansa's deputy in SDS, Education and Sport Minister Milan Zver, on the issue during a September 10 discussion, Zver was noncommittal. Comment -------------- ¶5. (C) If recent history is any guide, a center-right government led by Jansa will be more sympathetic toward Slovenia's continued participation in NTM-I than would a center-left government. If a center-left government comes in, we would advise Washington to come in early and hard to persuade Slovenia to turn off South Stream. On other foreign and security policy issues, we see little difference between the possible next governments. On the economy, neither the current government nor the center-left opposition is in any LJUBLJANA 00000421 002 OF 002 hurry to privatize. In 2004, Jansa's party talked a good game on privatization, but the results have been meager. Neither party is going to break Slovenia wide open for foreign investment absent sustained outside pressure. FREDEN