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Slovak leader: EU bailout fund 'a road to hell'

Slovak leader: EU bailout fund 'a road to hell'

An influential member of Slovakia's ruling coalition vowed on Wednesday to block a continentwide plan to boost the powers of the eurozone's bailout fund, calling it "a road to hell."
Richard Sulik, leader of the Freedom and Solidarity Party and parliamentary speaker, told The Associated Press that such measures are pointless and reveal the 17-nation eurozone's inability to get a grip on its problems.
"European politicians have been solving the crisis for a year and a half and the situation gets worse and worse," Sulik said.
Eurozone leaders committed in July to give the rescue fund, the "European Financial Stability Facility", new powers such as the right to buy bonds of governments struggling with their debt loads.
The (EURO)440 billion ($620 billion) fund will become the eurozone's main tool to fight the debt crisis by acting pre-emptively to help governments before they are engulfed in a full-blown crisis.
But because it would have more freedom to intervene in markets, some politicians like Sulik are worried that it would be playing loosely with eurozone taxpayers' money and does not represent a credible solution to the crisis.
"That's the reason why I reject it, it's a road to hell," said Sulik.
The Slovak government approved the plan to beef up the rescue fund on Wednesday. Slovak lawmakers will vote on the matter some time this fall, according to Sulik, once all other eurozone nations have delivered their verdict.
Sulik said that instead of creating new rules, the eurozone should stick to the original ones. "More or less all the rules set by the EU for the euro have been violated. What I say is let's stick to the rules," he said, adding that creating new mechanisms like the rescue fund actually threatened the long-term viability of the euro.
Without the votes from Sulik's party, the four-party coalition government does not have enough votes to pushed the legislation on the rescue fund through Parliament. It would have to rely on the opposition, making the outcome of the vote uncertain.
Fearing possible negative consequences for Slovakia and the euro if the country's Parliament kills the bill, President Ivan Gasparovic decided to organize high level emergency talks with coalition and opposition leaders to find common ground.
The talks should take place before the vote on the rescue fund in Parliament, presidential spokesman Marek Trubac told the AP.
Trubac said Gasparovic wanted his country to prove it is a "reliable member of the eurozone whose decision should not be the start of the eurozone's end."
Analysts suggested that even if Sulik's party voted against the bill to boost the eurozone rescue fund, cross-party support could be found in parliament.
"If every other country would support the changes (to the EFSF) the political pressure would be so strong that it would be hard for Slovakia to resist," said Zsolt Darvas, a research fellow at Brussels-based economic policy think tank Bruegel.


Updated : 2020-11-30 10:19 GMT+08:00