BRATISLAVA, July 1, (WEBNOVINY) — Finance Minister Ivan Miklos considers the proposal of SaS deputies on explicit participation of the private sector on restructuring of the Greek debt through a write-down of the principal the worst possible solution that would mean an uncontrolled default that could bring down also other countries with a potential debt problem, such as Spain and Italy. “There are no good solutions to choose from. We only have bad or worse solutions to choose from. Every solution that we adopt will have its costs. This solution is neither the best, nor the cheapest, while I even think it would be very bad and the most expensive,” the finance minister stated in the parliamentary plenum on Friday.
According to Miklos, Greece’s uncontrolled default would reflect in the Slovak economy through a hike of interest rates on financing the state debt. He went on to say that if interest rates were to go up by one percentage point, the costs of refinancing Slovakia’s state debt would increase by EUR 2.6 billion over next ten years.
Miklos admitted that a voluntary participation of the private sector could mean nothing but buying time. He is afraid Greece will not be able to cut spending sufficiently to be able to repay its debts. The finance minister called on the deputies not to support the proposal of the SaS party.
The opposition SMER-SD will not support the SaS proposal to reduce the mandate of the finance minister for negotiations on the second bailout of the indebted Greece, said the party deputy leader Pavol Paska. He accused the coalition of threatening the Slovak position within the EU and also criticized the prime minister and the finance minister for the change of their position on the Greek bailout. “SMER-SD will not vote for this proposal and we believe it is your business. These topics that are now sinking you won you political points before the elections. What is worst is that they incredibly damage years and years of building Slovakia’s good name,” Paska said.
Leader of the liberal SaS party believes that Greek default is the only right way and any prolonging of the agony in Greece will lead to greater damages. He claims that the euro is a good project, but rules must be obeyed, while Greece never fulfilled the Maastricht criteria. According to Sulik, no one has confirmed that Greece will be able to repay the second bailout. “I guarantee you that none of you would send their own money to Greece under these conditions. I don’t understand why we should irresponsibly handle taxpayers’ money,” Sulik added.
Governor of the National Bank of Slovakia Jozef Makuch indirectly commented on the Slovak position to Greece in Parliament on Friday, too. He called on the deputies to consensually vote on important issues regarding Slovakia in the local, but also external environment. “So that we understand that we are a member of a club and should behave like members of the club, and not take it as a one-way road where we get subsidies, but when our club needs something, it does not concern us,” Makuch said.
Parliamentary deputies are expected to debate whether to let Finance Minister Ivan Miklos (SDKU-DS) with full powers to decide on Slovakia’s participation in the new EU bailout of Greece on Friday until 3 p.m. After that, the session is to be interrupted until Wednesday, July 6.
SITA