Market Commentary and Intraday News
Slovakia: no more patience for European bailouts
319 days ago
(AP:BERLIN) Slovakia's prime minister said Tuesday that people in his country have run out of patience with European rescue measures and more aid can only be offered if troubled eurozone nations get their finances in order.
It is "very difficult" to explain to Slovaks why they should contribute to rescuing nations with significantly higher salaries and pensions, Prime Minister Robert Fico said during a visit in Germany. Slovakia is one of the newest and least affluent members of the 17-nation eurozone.
"In Slovakia, people live of a monthly pension of (EURO)280 ($350) and salaries stand at about (EURO)400 a month," he said. "It is very difficult to explain to those people why Slovakia contributes to assisting countries where ... wages stand at (EURO)3,500."
Fico's comments appeared to be a veiled reference to Greece, which has a higher standard of living but has needed two sovereign bailout packages and has lagged in implementing reforms and austerity measures agreed with its creditors.
"That is why Slovakia is not prepared to grant further financial assistance unless we have the guarantee that the countries who get those funds will also do their homework," Fico said through a translator.
"The public's patience has run out," Fico added, speaking alongside German Chancellor Angela Merkel.
Merkel said they "agreed that in the future, we will need more Europe, not less" to overcome the debt crisis, with every nation having to fulfill its obligations.
Last week, EU leaders agreed in principle to give Europe's new permanent bailout fund the ability to buy bonds on secondary markets to drive down countries' borrowing costs if those countries comply with recommendations from the EU's executive Commission for their economies.
Merkel reacted coolly Tuesday to a threat from Finland to veto such bond purchases. She said there was no urgency to act on the matter because no country has so far requested such assistance.
If a country requests assistance, Europeans will look for the most efficient way to provide it, she added.
Finnish Prime Minister Jyrki Katainen has said his country won't approve secondary-market operations because of the eurozone rescue fund's limited resources and because it believes them to be ineffective. Dutch Prime Minister Mark Rutte is also skeptical.
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.