Bloomberg News

Slovakia Sets Vote Date as Parties Seek Accord on EFSF

October 05, 2011

(Updates with comment from Polish EU presidency in fifth paragraph, Smer party leader comment in sixth. See EXT4 <GO> for more on the European debt crisis.)

Oct. 5 (Bloomberg) -- Slovakia’s ruling parties set Oct. 11 for a parliamentary vote on an overhaul of the euro area’s bailout mechanism as they seek an agreement to ensure passage of the bloc’s main defense to keep a debt crisis from spreading.

The governing Freedom and Solidarity party, or SaS, whose votes the Cabinet needs to retain a majority in parliament, continues to oppose the measures, Bela Bugar, head of the Most party, told reporters late yesterday. Without SaS, Premier Iveta Radicova will need support from Smer, the largest opposition party, which has said it will only back the legislation if the Cabinet steps down.

“We don’t have an agreement yet,” Bugar said after a meeting of leaders in the four-party coalition in the capital Bratislava. Negotiations with SaS will continue, he added.

Slovakia’s support for the European Financial Stabilization Facility, which must be ratified by all 17 members of the euro area, is seen as the most questionable among the three still to endorse enhancement of the bailout agreement. The European Commission has urged Slovakia to back the legislation. Malta and the Netherlands also have yet to ratify the EFSF.

‘More Procrastination’

“I think Slovakia will procrastinate some more,” Poland’s Deputy Foreign Minister Mikolaj Dowgielewicz told reporters in Warsaw today. “But I hope and believe that they’ll sign eventually. The markets are waiting for all the states to ratify as proof the EU is determined to defend the euro.” Poland holds the EU’s rotating presidency.

Slovakia’s largest opposition party Smer won’t back the overhaul of the EFSF in the Oct. 11 vote unless the government steps down, Chairman Robert Fico told journalists today.

The enhanced powers of the 440 billion-euro ($587 billion) EFSF were approved at a July 21 meeting of European leaders in Brussels. The measures would allow the fund to buy the debt of stressed euro-area nations, aid troubled banks in the region and offer credit lines to governments. The EFSF’s current role is to sell bonds to finance rescue loans.

--Editors: Andrew Langley, Alan Crosby

To contact the reporter on this story: Radoslav Tomek in Bratislava at rtomek@bloomberg.net Katya Andrusz at kandrusz@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net


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