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Miro Cerar, Slovenian Prime Minister

Our Relations Can Only Improve

Slovenia and Serbia are friendly countries that have a lot in common and are known to have varied and rich relations. I am confident that, after the next Serbian government is elected, we will further strengthen our economic cooperation to the benefit of our citizens

After exerting a lot of effort to respond constructively to the challenges of the migrant crisis, both at the European level and internally, the Slovenian government is turning attention to its regular activities.

In this interview for CorD, Miro Cerar, Prime Minister of Slovenia, discusses possible terror threats in the EU and the region and Slovenia’s role in countering those threats; promising economic trends in Slovenia and expectations when it comes to cooperation with the new Serbian government.

Do you believe that the current EU plan for dealing with the migrant crisis will hold firm?

I am very pleased that at the last EU Summit we finally came reached a common and comprehensive European solution to the migrant crisis. Namely, we jointly decided to get back to the full implementation of the Schengen Borders Code, to stop the irregular flows of migrants along the Western Balkan route and to end the wave-through approach. Based on the number of EU meetings, trust me, this was not easy.

March’s European Council meeting provided a very good basis to stabilise the migrant situation. In order to assure conditions for such stabilisation, from our perspective, the previously agreed closure of the Western Balkan Migration Route was of particular importance – not only because of the problems we have had with the flow of people passing through our territory, but also because we understand the importance of the stability of the Western Balkans, especially Bosnia- Herzegovina.

Now we – all EU Member states and Turkey – have to do our utmost to implement this agreement, to help all countries on the “front lines” with these assignments and prevent the emergence of new irregular routes. I hope sincerely that all points of the agreement will be properly implemented without delay. This is an agreement we have to respect.

Can the migrant crisis be resolved if there are ongoing tensions creating migrants in many parts of the world; who do you see as being most responsible for taking action?

I am confident that the migrant crisis can be resolved, but let’s not forget that its beginnings are complex and rooted in the past, and will in this respect require a lot of political will and international effort for the root causes to be eradicated.

A long-term solution to the conflict in Syria is crucial for bringing an end to the catastrophic humanitarian situation for the people living there. The political will and solutions recommended by major world players are key in this respect.

And then there are also other pressing issues that we must simultaneously address individually by eradicating the root causes of global warming, which causes environmental migrants and, of course, migrants fleeing poverty and a lack of any perspective in terms of ensuring a prosperous future for themselves and their children if they stay in their countries of origin.

It is crucial that there is no opening of new migration routes or the re-opening of the Western Balkan route. In order to achieve this, we, Slovenia and countries along the Western Balkan route, need to show a great deal of cooperation, as we already have

In this respect, how do you view the terrorist attacks in Europe and do you think the region will be open to such risks in the future?

Firstly, I would take this opportunity to once again strongly condemn all terrorist attacks worldwide. Every terrorist attack is an attack against humanity! The tragic attacks in Brussels and elsewhere were just the latest hostile acts against innocent people and peace-loving European society.

In the fight against radicalism and terrorism, a united response of solidarity by the international community is urgently required. Slovenia is committed to a joint fight of the international community against terrorism. Having stressed that, the Western Balkan region will remain an area of Slovenia’s particular interest and activities when it comes to countering these threats.

Mirko CerarOn the other hand, we must simultaneously address conditions or root causes to the spread of radicalisation, violent extremism and terrorism. The actions of the world’s major powers are crucial here!

Of course, there are some serious security threats that we have to deal with in relation to such masses of migrants entering the EU – especially considering the fact that their entry into the EU is more or less successfully registered. In general, and irrespective of the migration crisis, however, I need to stress the meaning of cultural differences. They are important and need to be addressed in an informed and educated way. All the institutions of our democratic countries play probably one of the biggest roles here, including the media and non-governmental organisations. This will be a challenge!

Nevertheless, in my opinion, the best integration policy is still employment. To see one’s future, to have hope in the future and the future of our children is still the strongest integration policy to date. Being abandoned on the periphery of society, being forgotten by the rest, breeds depression, apathy and, in the most severe cases, extremism. We, leaders, politicians and all citizens, are all responsible for preventing such worst-case scenarios.

What has been the cumulative effect of all these events on the Slovenian government’s schedule?

The events have taken a lot of space away from my political agenda, both at home and abroad, I must say. If I go back, I need to stress that the activation of the Slovenian Police, Army, humanitarian and other public or socially aware workers, also took a lot away from their regular daily activities. It was a burden.

Nevertheless, our services and volunteers did an amazing job. Because of them and their helping attitude, I can claim that Slovenia presented itself through the lens of humanitarianism and solidary. Ours is a system that is incomparable to the kind of system some bigger country can provide.

Exports will remain the engine of growth, with the contribution of private consumption to economic growth continuing to increase, and booming tourism adding to Slovenia’s economic revival

Has the migrant crisis created a serious challenge for bilateral relations between the countries in the region, or has it opened up new avenues for better cooperation? In this respect, how do you see the level of trust between our two countries?

From today’s perspective, I find it crucial that there will be no opening of the new migration routes or a re-opening of the Western Balkan route. Nevertheless, in order to achieve this, we, Slovenia and countries along the Western Balkans route needed to show a great deal of cooperation and coordination which could have only been achieved because we all have sincerely demonstrated sufficient political will for its realisation.

Today I can estimate Slovenia’s relation with neighbours in the migration crisis as good. Apart from initial problems that we have had with the previous Croatian authorities, I must say that our neighbours Croatia, Hungary and Austria have fully understood the importance of respecting the Schengen regime and stopping the irregular flow of migrants going through our countries. The same can be stated for Serbia and Macedonia, of course.

All of these countries have supported my initiative of stopping the irregular flow of migrants via Western Balkans by supporting or strengthening the Macedonian border with Greece.

The level of trust has increased among Slovenia and respective countries, that means also with Serbia, which showed a great deal of comprehending the complex situation of leaving the extreme flows of irregular migration flows moving through Western Balkans.

Every successfully implemented cooperation among Slovenia and the countries from the region is an impetus for further deepening of our mutual relations when it comes to issues of common interest. Security and well-being of our people should, of course, also in the future be on top of our common agenda.

Apart from the challenging political situation in the EU caused by terrorism, there are other burning issues, such as the possibility of Brexit and a new global economic slowdown. In your opinion, what does the future holds for the EU in political and economic terms?

The EU and its Member States have challenging times ahead of us. Although the financial and economic crisis is behind us, we are still not on the level we would prefer to. The EU hence faces further efforts to significantly increase employment, especially among the younger generations, and economic growth that would further feed the investment cycles upon which our development depends. Politically wise, we should preserve and strengthen the EU’s unity and raise awareness that only together we can be successful at competing on a global scale.

Do you think that the Slovenian economy is on a solid recovery track, albeit a moderate one, or do somewhat reduced predictions for 2016 and 2017 indicate new uncertainties?

Slovenia’s economic outlook for this year is encouraging. The spring forecast for GDP growth in 2016 is 1.7% and in 2017, 2.4%. Together with the faster than- expected 2.9% in real terms GDP growth in 2015 and 3% in 2014, the Slovenian economy is expanding well in international comparison. Exports, although they will fall slightly this year, will remain the engine of growth, with the contribution of private consumption to economic growth continuing to increase, tourism is booming. A lot remains to be done to boost the construction sector, however.

The labour market will continue to recover in 2016 and in 2017, in line with the recovery of economic activity. The current account surplus, which has reflected the widening gap between saving and investment in recent years, will stand at 7.5% of GDP this year and remain high in 2017.

At the same time, I am well aware of the challenges ahead. Those – as goes for the majority of European countries – include tackling the demographic pressure of ageing, further fiscal consolidation, a strong need to foster business dynamics to adapt to the market demand and least but not least, putting innovation as a driver of inclusive and green growth. My government is therefore above all focused on development, both economic and social as well as other areas, which can preserve Slovenia on the global map and enable a better life for our citizens.

The joint session between the Slovenian and Serbian governments will happen as soon as the newly elected ort re-elected Serbian authorities decide on a proper time for us to meet

Will the government follow the IMF’s advice to speed up reforms and the privatisation process?

Irrelevant of the institution the advice is coming from, my government is aware of the situation and times we are living in and is hence already tackling institutional and structural reforms with the aim to boost its productivity and growth. As OECD presented in the Economic Survey of Slovenia, we have done considerable progress in recent years in reforming the pension system and labour market as well as in recapitalizing the financial sector and in restructuring the corporate sector. In order to ensure long-term fiscal consolidation, we have adopted the fiscal rule. According to this, the general government deficit is expected to be below 3% of GDP in 2015.

Mirko CerarDue to decisive actions, Slovenia has once more regained the confidence of international investors, which is crucial for the revival of our economic activity. All the big three credit ranking agencies – Fitch, Moody’s, Standards & Poor’s – have upgraded their outlook for Slovenia, and what is more Slovenia’s rankings have advanced, including at IMD’s World Competitiveness Yearbook Scoreboard, the World Bank’s Doing Business Report and WEF’s Global Competitiveness Report.

The joint session between the Slovenian and Serbian governments will happen as soon as the newly elected ort re-elected Serbian authorities to decide on a proper time for us to meet 12 | 139 | MAY The impact of governmental policies on the domestic economy is reflected in the improvement of the general trust and higher key macroeconomic indicators. For example, we can witness higher consumer confidence than a year ago, as values measuring business confidence have been the highest since the beginning of the crisis. Now we need to upgrade and deepen these processes.

What causes the reluctance of the government and the society regarding the privatisation process? In this context, how would you comment on the fact that some Serbian investors have gained an ownership stake in some Slovenian banks?

I would not say that there is a reluctance of the government nor the society at large regarding the privatisation processes. It is simply the fact that, when it comes to privatisation, my government follows the principle of welcoming all those investors that are orientated towards the long-term development of the company in question. Usually, the processes slow down at a point when it gets clear that potential investors are only after a quick profit or do not have proper capital backing. In this respect, I cannot comment on any specific investors, but invite all those which have a long term strategic outlook for the future of the companies at stake.

Is the Serbian election campaign slowing down cooperation between our two governments, or will we see another joint session of the two governments soon?

The joint session between Slovenian and Serbian government will happen as soon as the newly or once again elected Serbian authorities will decide on a proper time for us to meet. Despite the scheduled and postponed joint schedule, it is completely understandable that the elections take their time and with them all international activities of the state.

When it comes to privatisation, my government follows the principle of welcoming all those investors that are orientated towards long-term development of the company in question, irrelevant of their origin

From Slovenia’s perspective, how do you see the plans to reconnect the region in terms of infrastructure; do these plans impact on domestic infrastructure projects?

The region of Western Balkans is at the geostrategic and infrastructural crossroads of Europe and a natural bridge between North and South, East and West. In the past those advantages of the region haven’t been fully exploited, thus preventing more dynamic regional cooperation as well as cooperation between the region and EU.

In this context, Berlin process, as well as Brdo Brijuni process, established a so-called “connectivity agenda”, which aims to re-connect countries of the region with the EU in terms of infrastructure, energy and economy. The implementation of the agreed infrastructural projects inside of the connectivity agenda remains essential in order to boost the economic recovery of the region and to link it more closely with the European economic and infrastructural corridors.

Slovenia has been always an active supporter of bringing the region closer to the EU, not just in the context of the enlargement process, but also in terms of concrete and viable infrastructural projects.

While the projects have been agreed upon, the real focus right now should be on viable mechanisms of financing for their implementation. European Commission has pledged appx 1. billion Euros for these projects, now it is also up to the countries of the region to make these projects attractive for potential investors in order to complete the transport and infrastructural network in the Western Balkans. With this in mind, I believe that the Paris Summit of the Berlin Process will produce concrete and viable results, especially in the field of transport and infrastructural connectivity.

Lastly, I want to stress that regional infrastructural projects will have a positive impact on the domestic projects since both are complementary and essential in order to complete the infrastructural network in the region and connect it with the EU corridors.

What are your priorities when it comes to cooperation with the new Serbian government to be formed after the upcoming general election?

Slovenia and Serbia are friendly countries that have a lot in common and are known to have differentiated and rich relations. I am confident that after the next Serbian government will be formed we will continue in the same direction while keeping our high-level political dialogue and further strengthening our good economic cooperation that still hides a lot of potential waiting to be seized to the benefit of both economies and hence our citizens.