How Brave Will New Slovak Government Be?

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The epidemic of good advice, tips, challenges, and recommendations for the new Slovak government is much stronger than the viral one. There are many things to fix, to improve, and especially – to save.

However, I really miss the topic of state enterprises in the discussion. We shall have the center-right government. At least according to the media.

In the good old days, the right-wing government symbolized tax reforms, liberalization, and privatization. A political scientist would say that the concept of the division to the left-wing and the right-wing died with the arrival of the 20th century. I will look at it in more pragmatic way, from my economic point of view.

Of course, I do not expect any dramatic liberalization or privatization. But even the leaving government was brave enough to mention the liberalization and privatization only in two specific cases.

I speak about liberalization of the passenger transportation on the railway and privatization of Slovak Post. In the former case, we are, more or less (but rather less), pushed by the European Union.

The state should tender the supported passenger transportation, not choose the (state) carrier in advance. Although the leaving government, or the ones before it, was not openly against the liberalization idea, we could see only a sort of tender for the railway line from the capital to Komárno town in the south, and nothing after that.

The tender for the other lines was being prepared for a long time, until the preparation eventually failed. We could see some kind of a parody at the very end of the governing, when there was an opportunity to tender for “tails” – absolutely unattractive and pointlessly chosen railway lines.

The reason is clear. A big open tender would cause huge losses in terms of performance for the state-owned train operator. This would mean significant shrinkage of this state enterprise, as well as the decrease of the political control over the railway transportation.

I believe, however, that it would be more than balanced by the services with better quality for passengers in the competitive environment.

Furthermore, there was a surprisingly open discussion about the privatization of Slovak Post back in 2017. Even the half-dead Bratislava stock exchange was meant to be used.

Big privatizations of Royal Mail or Deutsche Bundespost have shown that the political control over the paper post makes no sense in the times of e-mails and couriers.

Thanks to the usage of the stock exchange, citizens may become the actual owners of such enterprises, not only fictitious ones – as in case of the state enterprises.

Neither the sale of drugstore goods, nor the cooperation with a private bank has drawn the great future for Slovak Post. Revenues of the company have stagnated for years, and the profit – if any – is miserable. The poor level of services and tough work conditions of Slovak Post mean that it will not be difficult to persuade the electors. Only one thing will be necessary – the political courage.