Finance Minister Tonio Fenech is confident the Slovak Parliament will ratify the revamped European Financial Stability Facility after its rejection on Tuesday.
Mr Fenech told The Times Business that while Tuesday’s vote in the Slovak Parliament was of concern he was confident the country’s political parties will rise to the occasion and appreciate the importance of ratifying the eurozone’s strengthened rescue fund.
“The initial rejection of the European Financial Stability Facility by Slovakia is worrying and the markets need to calm down, not become more volatile. The consequences of not working together, on a European level, to address this eurozone crisis will be huge. As we have seen only a couple of years ago a financial crisis can lead to an economic crisis and a loss of jobs throughout Europe and I don’t want that to happen,” Mr Fenech told The Times Business.
“I am confident, however, that the Slovak Parliament will ratify the eurozone fund soon as I am sure most parties appreciate the importance of this vote.
“The indications are that the main opposition party will now vote in favour of the fund.”
Slovakia is the only eurozone country to have rejected the changes to the €440 billion rescue fund that was set up after Greece was bailed out in May 2010.
The ‘No’ vote, the result of the Freedom and Solidarity Party – a junior coalition partner in the centre-right Slovak government – voting against the fund, brought down the coalition of Prime Minister Iveta Radicova, who turned it into a vote of confidence at the same time. However, Parliament has not been dissolved, which means a new vote can take place soon.
The Freedom and Solidarity Party claims Slovakia, the poorest member of the eurozone, would pay more than its fair share towards the fund. Slovakia, a nation of 5.5 million people, would contribute about one per cent, or €7.7 billion.
Asked if he thought that public opinion in Europe was moving against further bailouts Mr Fenech that that while he understood people’s concerns it was important for everyone to see “the bigger picture”.
Meanwhile Europe yesterday urged Slovakia to quickly hold a new vote on the eurozone debt rescue fund.
“The world economy is heavily affected by the financial crisis and every EU country must contribute its share to the fight against the debt crisis,” German Chancellor Angela Merkel said during a visit in Vietnam. She also said she was confident the expanded bailout fund would be ratified this month.
French Foreign Minister Alain Juppe said Slovakia’s rejection was “not good news” but was confident the government would organise a second vote.
“We call upon all parties in the Slovak Parliament to rise above the positioning of short term politics, and seize the next occasion to ensure a swift adoption of the new agreement,” EU Council President Herman Van Rompuy and European Commission President Jose Manuel Barroso said in a joint statement.