Since its accession to power, the national conservative government, appointed by the PiS party (Law and Justice), is systematically altering the state in order to secure its power on a permanent basis. The opposition is having a hard time. The fact that the electoral law should now be adapted to the party’s needs is not really surprising.
The 2008 financial crisis, geopolitical tensions, and other macro factors have slowed down SOE privatization. In some CEE countries, the trend has even reversed. Estonia nationalized its railways in 2007 and Lithuania bought out private investors in its energy companies.
The Hungarian state’s share in the economy is high – but mostly in line with other countries. What stands out among OECD countries is the number of companies owned partially or wholly by the state that attests to some degree of micromanagement.
In Serbia there is a plethora of possible government policy actions beyond the establishment and operation of SOEs. Having in mind the negative results stemming from the operation of SOEs, to alleviate this problem an approach other than appointing new management is necessary, as might be heard in public discourse.
Milton Friedman once remarked that “you must separate out being pro-market from being pro-business”, and continued: “the two greatest enemies of the free enterprise system, in my opinion, have been on the one hand my fellow intellectuals, and on the other hand, the big businessmen – for opposite reasons”.
On the whole, CEE countries – including Poland – still positively stand out in this respect among its European peers. Yet, this might soon come to an end as Poland’s governing party (LAw and Justice) is planning to introduce significant restrictions on Sunday trade.
Numerous needed reforms and laws guaranteeing and protecting equal rights and freedoms have not been passed in Latvia due to lack of political will or poor public administration (or perhaps both). And in the era of the rise of populism, these advances seem more and more distant and unrealistic.
The Lithuanian Social Democrats have withdrawn from the governing coalition led by the Peasant-Greens, making it a minority governmnent. Of the three Social Democrats Ministers, only Foreign Minister Linas Linkevičius will leave his party to remain in the government.
The VAT base in Poland has its weaknesses due to both domestic and EU polices. National authorities overuse reduced rates, making the VAT system too complicated and problematic for businesses while a zero rate on intra-EU trade incentivizes fraud.
Two interesting debates are being led simultaneously in Slovakia. One on subsidies to support the mining of lignite in the upper Nitra region and the other on the unconditional basic income for all. The interconnection between the two could bring so many positive effects that I am left to wonder why nobody has thought of this so far.
