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Eurozone emergency loan approval

07-16-2010 08:31 BJT

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The Slovakian government has approved the euro zone's emergency loan facility. The decision was made under pressure from its European partners who say the fund is a crucial part of efforts to restore confidence in financial markets after the Greek debt crisis.

Objections to bailouts became a campaign issue in the country's June election.

But the government is yielding to pressure from its European partners to drop its resistance.

Iveta Radicova, Slovak Prime Minister, said, "The Slovak Government voted to support the political declaration which was endorsed by the previous government in May. But at the same time we approved a declaration with concrete requirements for the possible participation of Slovakia in the European rescue mechanism."

Slovakia's share in the overall 750-billion-euro fund is 4.5 billion euros worth of guarantees.

Ivan Miklos, Slovak Minister of Economy, said, "When we compare the economical and living level, the Slovak portion of the loan to Greece and to the European Financial Stability Facility is more than twice as high as the contribution from the richest country, which is Luxembourg."

Although the cabinet recommended parliament not to approve an 800 million euro bilateral loan to Greece, which would be Slovakia's contribution to the EU package, the parliament finally approved it.

A resident in Bratislava said, "I don't think we should pay because the Greeks wasted money for a long time and it is their problem. They should face the consequences themselves."

The cabinet says it would demand creation of stricter fiscal rules in the euro zone, including a mechanism for bankruptcy for countries with irresponsible fiscal policies, before any aid from the fund is released. The government also says temporary financial support to troubled countries will have to be in line with the IMF's policies and conditions.

Editor:Zhang Jingya |Source: CNTV.cn

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