"Euro-rebels want to collapse the parachute.."..

Source: Die Welt.

Print Review Author: Hans-Jörg Schmidt | 11:56
Euro-rebels want to collapse the parachute

Slovakia is small could bring the euro to rescue case. "The powerful is taken, those who can not economize will be given," it says.

Many a German member of parliament may have thrown in recent days an unread him from Bratislava sent to Fair pamphlet in the trash. Even the title of the 20-page work "euro rescue package - the road to socialism" seems exaggerated. And who is the author Richard Sulik? Never heard of it.

Richard Sulik, Solowakei and President Christian Wulff
Photo: dpa Richard Sulik, President of the Slovak Parliament and vehement opponent of the euro rescue package, the visit of President Christian Wulff

President Christian Wulff met the man earlier this week in Bratislava. Sulik is president of the Slovak Parliament, and although Wulff had traveled for a courtesy visit to the Danube, it went between the two reportedly much to the point. Strongly campaigned for the German solidarity in the euro crisis. With business partners such as the Prime Minister Iveta Radicova he was about to quickly agree. With Sulik not.

The tough adversary

The head of the neo-liberal party "Freedom and Solidarity" (SaS) and his 22 deputies are the toughest opponents to the plans of the Euro-government, states such as Greece continues to support - and the EU to move a big step toward a transfer union. In 13 of the 17 euro countries, the parliaments of the expansion of the joint bailout EFSF voted. The agreement of Portugal, the Netherlands and Malta is considered safe. Only the Slovak rebels fighting against it.

It not only Head of Government Radicova is politically dependent on the votes of the smaller coalition partner: Is the opposition in Bratislava against the EFSF expansion, then the whole project fails. The fear of stoking the euro. "A rejection of the Slovak Parliament would have devastating political consequences," Guntram Wolff, deputy director of the Brussels think tank Bruegel warned.
Deep poverty

Slovaks earn 5.5 million a year in gross domestic product (GDP) of 63 billion €. Slovakia is thus the rear Estonia's second-poorest country in the 17 euro countries.
Great economy

With a national debt of 41 percent of GDP in Slovakia is but one of the few Euro countries, which adheres to the established in the euro-zone debt ceiling. In early 2009 Slovakia introduced the euro.
Great danger

Since summer 2010, Prime Minister Iveta Radicova governs with a coalition of four parties. One of them is the liberal party "Freedom and Solidarity" (SaS). The economist and former businessman who founded the Richard Sulik SaS until 2009 - and ended 2010 with twelve percent of the vote in parliament and government. Without the 22 votes of the SaS has the government coalition in upcoming Euro-crisis laws no majority in parliament.

For it not only the Slovaks is difficult to spend more money for the rescue waning euro countries like Ireland or Portugal. The parliamentarians of most countries, however, have overcome their concerns and agreed to the extension of the rescue parachute - assuming that the political wisdom dictates that all other members. Guntram Wolff warns: "No one would trigger in many European capitals discussions about their own contribution to the EFSF. Other countries could then withdraw their participation again. "

Rebellious Finns have agreed

For example, the Finns. They insist still on collateral for their fund contribution in the amount of 14 billion €. Although this lien dispute is far from resolved, the six-party coalition of Prime Minister Jyrki Katainen voted unanimously in Helsinki for the extension of the EFSF. The Finnish government will strengthen the bargaining position at the European level, not just that - swerved another country, it could be a welcome opportunity for the Finns to rethink their consent again.

Photo: Won is the case of four countries still in the approval of the EFSF

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Photo: Won is the case of four countries still in the approval of the EFSF

Sulik, the fights not. "The powerful is taken, those who can not economize will be given," he railed this week. "That was socialism in Sun Of these, we definitely have enough for 40 years. "The fact that it would pay to Slovakia as the poorest country in the euro-zone for the Greeks, he considers" perverse ". Sulik is fighting against a transfer union and unification of economic and fiscal policy.

His concern: a common economic government could eventually control the functioning unit in Slovakia abolish that bears his signature. Together with the low wages they have brought the country a competitive advantage. This concern is shared even government officials who want to vote for the expanded bailout.

Bowed to pressure Europe

But yes it does not come from the heart. Prime Minister had Radicova together with Finance Minister Ivan Miklos, the participation in the first tranche of aid for Athens steadfastly refused - with the arguments now being used also Sulik. She leaned intense pressure from Europe.

Photo: picture alliance chrome orange / The Slovak flag

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Photo: picture alliance chrome orange / The Slovak flag

Not only is the Federal President, Chancellor Angela Merkel had edited the Christian-liberal counterpart. Finally Radicova "upset," criticizes coalition partners Sulik. And can gleefully point out that many people think like him, it just does not say more loudly, "so we do not have a bad impression in Brussels, although we will be left with a bare butt."

The skepticism about Europe's political capital Sulik. With its neo-liberal party's founding, he scored in the elections last year from 12.4 percent to the state and since then has led to the third-largest party in Parliament. Since then, however, shrink from the poll numbers Sulik "Freedom and Solidarity", the last party was about eight percent.

Persuasion needed

Bela Bugar, head of the Hungarian party, sitting with the government holding in Sulik, before him, with his populism simply want to improve these values. What could well be important soon - because Radicovas problem is that they, unlike Angela Merkel, can not rely on the opposition when it comes to a vote in Slovakia.

How the rescue systems

There are two €-rescue systems - the modified preliminary and its permanent successor mechanism EFSF ESM, the middle of 2013 enters into force.

Both instruments should be able to ailing euro-zone nations to better assist in an emergency, without new, irritating the financial markets rescue of the 17 euro countries are needed.

An overview of the key elements of both mechanisms ...

The European Financial Stability Facility (European Financial Stability Facility, EFSF) was on 10 May 2010 as interim euro rescue of an EU summit launched. They will be replaced in mid-2013 from the permanent bailout ESM, which should have the same opportunities. EFSF is run by the German officials Klaus Regling.

Prerequisite for the help of both institutions is that the stability of the Euro-zone as a whole is endangered and is a recipient of a hard country undergoing economic reform program.

Must also be clarified in advance whether a country receives aid credits, can repay them.

For the disbursement of loans, a unanimous decision by the donors is necessary.

The recently approved revised EFSF contract provides that the volume of credit for troubled states to effectively € 440 billion euro rises.

So take the EFSF such a sum in the financial markets at low interest rates and then can forward at a premium of States, the euro-citizens in accordance with their share of the European Central Bank is now up to 780 billion euros.

Germany is liable for a share of 211 billion euros.

As a precaution, the hedge has been calculated that even without a contribution from Greece, Ireland and Portugal, the full loan amount would come together.

Unlike before, the future may EFSF loans in the primary market, then buy directly from states - along with the ESM from 2013.

This new instrument can provide a kind of parachutes jump start, if they participate in a new bond issue in the country, the returns on the capital markets.


The euro-zone countries on 21 July, the guarantee-extension and four new instruments for the EFSF and decided to adapt their EFSF Framework Agreement. The four instruments are:

- The primary market purchases of bonds: The future EFSF can buy from the newly issued government bonds directly.

- Bonds in the secondary market: Even bond purchases on the stock exchanges are possible, but only in exceptional cases.

- Contingent Credit Lines: Euro countries can assure themselves of the EFSF a credit line that they must not use. This is to reassure the financial markets.

- The EFSF countries may in future give special loans to enable them to recapitalize their banks.


From mid 2013 to replace the long-term euro rescue ESM EFSF.

It can make loans up to 500 billion €.

For a good credit rating, he still needs "only" a hedge of 700 billion €, because he's different from the EFSF a capital stock of 80 billion euros in cash.

The German share of the total liability thus falls in the transition from EFSF on the ESM 190 billion €.

Germany must ensure that amount of nearly 22 billion euros into the capital stock.


The ESM contract stipulates that from 2013 all included in the euro-zone government bonds issued with a maturity of more than one year, the clause that private investors are involved in a crisis resolution.

In Article 12, two scenarios are defined: If a country only in a temporary liquidity crisis, private creditors should be encouraged to keep their loans longer.

In the bankruptcy case, the Member State must necessarily negotiate with the creditors - the private sector would be involved if necessary, such as on an average debt.

Both cases, however, refer only to the mid-2013 issued new bonds with the so-called collective action clauses CAC.

Details of the CAC rules should be clarified by year end.


The ESM is similar in its outstanding loans as a preferred creditor status of the IMF.

In the bankruptcy case, these loans take precedence over those of taxpayer money in private hands will be served.

An exception is made only if utilities are started prior to ESM and then transferred - then waived the ESM on a preferred status it today for the EFSF are not.

The federal government emphasized that this restriction can apply only for a transitional phase in cases such as Greece, Ireland or Portugal.

Margin calls and DEVELOPMENT

At least every five years should be checked whether the ESM framework should be changed.

There may be an additional funding requirement for countries, if loans are not repaid.

In any case, as for Germany, but the limit of liability of 190 billion euros.

From the existing EU Finance Ministers Council may also amend the purchase of financial instruments such as the primary market or established at 200 basis point premium for loans contracted and set up a reserve fund and other funds.


Important decisions can make the Board of Governors unanimously.

In many technical questions of a qualified majority shall be 80 percent.

Because Germany holds about 27 percent of the shares it has in these cases as a de facto veto.

It is not clear how the nation states to take the decision of their representatives on the Board of influence.

Many federal MPs claim that the German position is set before important decisions by parliamentary approval - unlike the EFSF, in which the government must establish only one agreement with the Budget Committee.

The scheme will be regulated in the fall in its own national interest law.

Source: Reuters, as of September 2011

Ex-Prime Minister Robert Fico had indeed once supported the euro rescue. As opposition leader, but he feels no longer mandatory. His party would accept the new rescue package unless the government also closed camp voted for it, he says slyly. Fico speculate on the failure of the government and subsequent elections: polls show he would win hands down.

Radicova is nothing to negotiate with than their small coalition partner. Austria and the German Federal Council had just approved - - on Friday announced the party Sulik, they "believe in a solution that the bailout may boost the euro zone and Europe such as Slovakia would be acceptable." Is this the breakthrough?

The EU is alarmed

Who nachhörte in Slovak government circles, was quickly disappointed. You talk about a solution that could facilitate the approval of SaS. Which provides that the extension of the rescue parachute Slovakia but agrees - on condition that the country must pay a cent, even when guarantees for the euro rescue should be paid.
German Finance Minister Schaeuble speaks with Chancellor Angela Merkel during the session of the Bundestag lower house of parliament in Berlin

Schäuble advertises EFSF increase

That sounds like an elegant solution - but would not constitute a denial of EFSF reform by the Slovaks. The EU is arlamiert. Merkel and Prime Minister of Greece George Papandreou Radicova took their counterpart on Friday at the sidelines of a meeting in Warsaw in prayer. And the Slovak EU Commissioner Maros Sefcovic warned that special favors are to give the European partners is difficult. He feared for the reputation of Slovakia.

"I can not just introduce me to negotiate the new agreement, have since so many countries, including Germany agreed," he said. At the veto power of small countries can also despair, who himself comes from one.

Elapse until the vote in national, at least two weeks. The Slovaks have to stiffen, to vote last in the euro-zone. For 11 October was scheduled to vote first, the first sitting day after the summer break. Given the coalition crash can not keep the appointment. Nevertheless Radicova announced optimistic after meeting with Merkel, Slovakia will be no later than 14 October agree. The next summit of European leaders in Brussels, the Prime Minister not want to travel with empty hands.

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