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PM Insists Slovenia Does Not Need a Bailout

New York, 17 April (STA) - Slovenia does not need a bailout and comparisons with Cyprus ignore the economic fundamentals, Prime Minister Alenka Bratušek said in an opinion piece published by the Wall Street Journal on Wednesday.

"Not all is rosy in Slovenia, but that is true for all of Europe," she said, but noted that Europe, and Slovenia in particular, is "underwriting massive reforms in the public and private sectors".

She acknowledged that the banking sector was "in trouble", which is why the government will establish a bad bank. "Fixing [the banking system] is an absolute priority. A healthy lending environment is key to economic growth."

The government will also promote "sustainable and equitable" growth underpinned by the preservation of a "reasonable and functional safety net".

"We will not let go of this idea; support for public programs like medical care and education will continue. But controlling and effectively allocating public expenses is the way toward fiscal health."

It will also privatize. "I want to reduce the government's direct participation in the real economy. Assets that are in good financial condition will be sold to the highest bidder or to strategic partners who can add significant value to the acquisition."

Meanwhile, distressed assets will be brought under temporary government ownership, restructured and sold.

However, Bratušek also reiterated her government's position that it will not pursue austerity at the expense of growth.

"It is impossible to pay down debt if you can't expand revenue, and the way toward greater revenue is greater growth."

In a barb to financial markets, Bratušek said it was "trendy to speculate which EU country will collapse next...But this is nothing more than misguided speculation."

"We don't need money. Given some trust and some time, Slovenia will again be a vibrant economy and a bright star of Central Europe," she says.

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