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Slovakia rejects Europe bailout fund on initial vote

October 11, 2011 |  1:46 pm

Slovak parliament
REPORTING FROM LONDON –- Lawmakers in Slovakia on Tuesday rejected a proposal to beef up Europe’s bailout fund for debt-stressed nations, but supporters are holding out hope that the measure will pass in a second vote expected to take place within days.

The government was able to muster only 55 votes in the 150-member parliament, well short of the 76 needed for passage. Nine lawmakers appear to have voted no, and the rest abstained or were absent.

The plan to strengthen the rescue fund is widely considered imperative for Europe as it tries to tame a debt crisis that has already forced Greece, Portugal and Ireland to accept emergency loans to stay afloat. But in a tense showdown, a junior party in Slovakia’s ruling coalition refused to back the measure, saying Slovaks should not be on the hook to bail out richer but less financially responsible nations.

Expansion of the fund requires the ratification of each of the 17 countries that share the euro currency. All but Slovakia have given their approval.

Prime Minister Iveta Radicova is now expected to appeal to Slovakia’s main opposition party to help her government pass the measure in a second vote. But its support will come at a steep price: The party’s leader has said he will back the plan only if Radicova calls an early election.

Analysts say she has little choice but to comply. Not to do so would risk throwing already volatile global markets into even greater turmoil.

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-- Henry Chu

Photo: Slovak Prime Minister Iveta Radicova speaks in parliament on Oct. 11, 2011. Credit: Petr Josek / Reuters

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