The financial crisis in the eurozone is having political consequences in the geopolitical continent, and not just in Greece and Italy. Slovakia’s reforming coalition government under Iveta Radicova dramatically fell when it failed to reach internal agreement over the European Financial Stability Facility – the bailout package to save the euro on which all EU countries were voting in early October.
The governmental upheaval was started when Richard Sulik, leader of the Freedom and Solidarity Party, and his supporting MPs (totalling 21 out of 150 in the National Council, the Slovakia’s parliament) refused to agree to the bailout.
The package went through eventually but Ms Radicova’s coalition government was no more. At least not for a week or two because shortly after, president Ivan Gasparovic announced there would be an interim government until elections are held in March 2012, and then a few days later announced that Radicova would run the caretaker government.
So all change but no change? Ms Radicova is back in but with fewer powers, particularly in regards to the country's economy. And some of her reformist agenda, including changes to the judiciary, will doubtless be postponed. For this reason, though it is unlikely that FDI levels will be specifically upset by this recent political merry-go-round, if those reforms, which may have encouraged greater levels of FDI into the future, are put off indefinitely, this may have a knock-on effect on long-term FDI.