Slovak parties in deal to approve EU bailout fund

By Karel Janicek

Associated Press

Published: Wednesday, Oct. 12 2011 9:45 a.m. MDT

Robert Fico chairman of the strongest opposition party SMER-Social Democracy holds a press conference at his party's headquarters in Bratislava, Slovakia, Wednesday, Oct. 12, 2011. Slovakian lawmakers on Tuesday rejected the expansion of the euro currency zone's bailout fund. After 10 hours of debate in parliament, the measure failed to pass by 21 votes. Slovakia remains the only country in the 17-member eurozone that has not approved expanding the bailout fund, which requires unanimous support to go into effect. The package of measures is designed to boost Europe's firefighting capabilities in the region's financial crisis. Slovakia's 1-year-old coalition government also fell with the vote because it included a no-confidence measure.

Petr David Josek, Associated Press

BRATISLAVA, Slovakia — Slovakia's main political parties have reached a deal to approve changes to an EU bailout fund this week, the main opposition leader said Wednesday, just one day after parliament rejected the proposal, causing the government to fall.

Robert Fico, head of Smer-Social Democracy, said that in exchange for his party's votes, three outgoing government party leaders have agreed to hold early general elections on March 10.

"Slovakia will ratify the EU bailout fund without any problems. I believe it will happen on Friday this week at the latest," Fico said.

Tuesday's vote failed because a junior coalition party, the Freedom and Solidarity party, was against it. In a desperate effort to force that party to vote in favor, Prime Minister Iveta Radicova had tied the vote on the bailout fund to a confidence vote in the government. When the vote failed, her 1-year-old government collapsed.

With the government now defunct — and with the promise of early elections — Fico said his party will vote in favor of the bailout fund, which all 16 other members of the eurozone have already supported.

The leaders of three coalition parties — Mikulas Dzurinda of the Slovak Democratic and Christian Union, which Radicova belongs to; Jan Figel of the Christian Democrats and Bela Bugar of a party of ethnic Hungarians — confirmed the deal later Wednesday.

"We had to pay a political price," Bugar said. "And the early election is the price."

The announcement came hours after EU President Herman Van Rompuy and European Commission President Jose Manuel Barroso called on Slovak political parties "to rise above the positioning of short-term politics, and seize the next occasion to ensure a swift adoption of the new agreement."

They said the enhancement of the €440 billion ($600 billion) European Financial Stability Facility is crucial "to preserve financial stability in the euro area. And that is in the interest of all euro countries, including the Slovak people."

Eurozone leaders had agreed in July to increase the size and powers of the bailout fund, giving it the ability to lend quickly to governments in case of market trouble in order to contain the stubborn financial crisis.

Fico's populist leftist party is by far the strongest political force in Slovakia and stands a good chance to win the early ballot. It won last year's general elections in June with 34.8 percent of the vote, taking 62 seats in the 150-seat Parliament.

The senior party of the outgoing coalition, the Slovak Democratic and Christian Union, was well behind in second, with 15.4 percent, or 28 seats.

Fico's party campaigned on a promise to maintain the country's welfare state even as other European countries slash their budgets to deal with the economic crisis.

During his term of prime minister between 2006 and 2010, Slovakia adopted the euro currency in 2009. Despite him taking the largest share of the vote in the 2010 election, four opposition parties with a majority of 79 parliamentary seats agreed to form a ruling coalition.

Don Melvin in Brussels contributed to this report.

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