New Slovak Parliament Rejects Loan to Greece

By Peter Sedik
Peter Sedik
Peter Sedik
August 13, 2010 Updated: August 13, 2010

BRATISLAVA, Slovakia—Slovak legislators on Thursday rejected paying its share of a Greek bailout, prompting disapproving reactions from other European Union members.

Slovakia’s new right-wing government, which took office in July, declared its intention not to support the loan during the recent campaign. The move backtracks on promises made by Slovakia’s previous prime minister, Robert Fico,

The strongest critique of the move came from the Germany. Germany’s banks own a large portion of the Greek loan.

Fico had pledged that Slovakia would pay its share of the bailout, but delayed final approval of the measure until after the elections—which his party then lost.

In Thursday’s vote, even Fico’s socialist party members did not vote in favor of their own proposal, so the loan was rejected with only two yes votes.

Spokesman of German Chancellor Angela Merkel criticized the decision as lacking solidarity, a claim dismissed by the month-old government. Merkel will meet with the new Slovak leader Iveta Radicova on Aug. 25 during her visit of Germany.

Radicova criticized Greece for its “irresponsible” budget policies, and expressed doubts that the new loan will help Greece to avoid bankruptcy.

In Slovakia, one of the poorest EU-member countries, the issue of the Greek loan is rather sensitive. Most people oppose lending money to a richer country, whose minimum wage is almost three times higher than in Slovakia, which entered the eurozone in 2009.

Slovak Parliament approved of Slovakia’s share in the eurozone safety net aimed at preventing potential financial problems for eurozone members of the future.

Slovakia will provide $5.8 billion worth of loan guarantees, out of the $962 billion package.

Peter Sedik