Slovakia's centre-right opposition has a good chance of ousting leftist Prime Minister Robert Fico in Saturday's election as the ruling party is grappling with allegations of improper funding eight years ago.
Voters are split between economic liberals, whose reforms led Slovakia into the European Union and earned billions in foreign investment, and Fico, whose tough stance against big business and efforts to protect workers appeal to poorer people.
The last two pre-election opinion polls, released on Thursday and Friday, showed the ruling SMER party would win the June 12 vote but would be unable to cobble together a majority to form a government.
After consistently leading the polls, SMER suffered a drop in popularity this week after Slovak media published a tape recording suggesting the party received illegal funding in the 2002 election campaign.
SMER has denied claims that it did not account for some of its funding in 2002 and accused rivals of leading an illegal campaign against it. Opposition parties rejected its accusations.
Fico denied the authenticity of the tape and said he had done nothing wrong. "There is an illegal campaign going on, which is aimed at causing a scandal for one political subject which forms the basis of the ruling coalition and the Slovak government (SMER)," Fico told reporters on Friday.
Fico said he had filed a lawsuit against the daily SME, one of the papers and broadcasters which had published the recording. The Attorney General said the office would launch an investigation into the case.
Fico also came under the media spotlight for awarding 17,000 euros to a fitness model, at a time when Slovakia was fighting its worst floods in history and public funds were needed to supply the badly hit regions.
Former Prime Minister Mikulas Dzurinda, Fico's main rival and head of the opposition SDKU party, pulled out of the election race over accusations of money laundering in February. Like Fico he denied breaking any law.
Fico took power in 2006 and cut a power-sharing deal with the far-right Nationalists (SNS) and the HZDS party of former authoritarian prime minister Vladimir Meciar.
Dzurinda's SDKU, the strongest opposition party, has said a centre-right coalition with the Christian Democrats (KDH), liberal Freedom and Solidarity (SaS) and two ethnic Hungarian parties SMK and Most-Hid is the best option for Slovaks.
Such a government may refuse to pay its share of the Greek bailout package, showing how the sovereign debt crisis has eroded European unity and highlighting tensions generated by the bailout for euro zone debtors.
Slovakia, which joined the euro zone only in 2009 and is much poorer than Greece, is due to vote in July on its 800 million euro ($960 million) contribution to the 110 billion euro bailout for Athens.
A centre-right coalition would include ethnic Hungarian parties and would help improve relations with Budapest, which have worsened since Fico picked SNS as a partner.
The euro zone's youngest member is emerging from recession and needs to make further reforms in its pension system and reduce government spending to consolidate its fiscal position, as planned. The 2010 fiscal gap is seen at 5.5 percent of GDP.
Dzurinda's previous centre-right government introduced a 19 percent flat tax on income and corporate profits which lured foreign direct investment worth billions of euros, notably in the car industry, and investors favour a return of this trend.
Fico advocates a strong state role in the economy but has departed little from orthodox policies.
ReutersLast Mod: 11 Haziran 2010, 20:02