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Finance Minister Mikloš will seek changes in ESM contribution formula

Slovakia will hold firm to its view that the ratio of contributions by individual eurozone members to the permanent European Stability Mechanism (ESM) that is due to become effective in 2013 should be changed, Finance Minister Ivan Mikloš told a press conference on February 23, the TASR newswire reported. The minister added that the government will remain adamant that a country's economic potency should be used as the main criterion when the issue is discussed. In line with the European Financial Stability Facility (EFSF), the scheme to provide financial assistance to eurozone countries in distress currently calls for countries' contributions to be calculated according to the amount of capital they have in the European Central Bank. In addition to a country's economic power its population is also taken into account, resulting in a formula that is unfair to smaller countries, Mikloš said. "We're aware of the need for cohesion and solidarity in the eurozone and we're ready to take part in this permanent mechanism, but our key condition is that the formula stipulating the countries' engagement in it should be changed," said Mikloš as quoted by the TASR newswire.

Slovakia will hold firm to its view that the ratio of contributions by individual eurozone members to the permanent European Stability Mechanism (ESM) that is due to become effective in 2013 should be changed, Finance Minister Ivan Mikloš told a press conference on February 23, the TASR newswire reported.

The minister added that the government will remain adamant that a country's economic potency should be used as the main criterion when the issue is discussed. In line with the European Financial Stability Facility (EFSF), the scheme to provide financial assistance to eurozone countries in distress currently calls for countries' contributions to be calculated according to the amount of capital they have in the European Central Bank. In addition to a country's economic power its population is also taken into account, resulting in a formula that is unfair to smaller countries, Mikloš said.

"We're aware of the need for cohesion and solidarity in the eurozone and we're ready to take part in this permanent mechanism, but our key condition is that the formula stipulating the countries' engagement in it should be changed," said Mikloš as quoted by the TASR newswire.

In addition to economic power, the condition of the financial sector and the country's total debt also ought to be included as complementary criteria according to Mikloš who also noted that fellow eurozone countries such as Estonia and Slovenia are of a similar opinion. He voiced his optimism, therefore, that the condition will be given the green light.

The issue of a competitiveness pact, as outlined by Germany and France, will also be addressed at meetings of EU leaders and finance ministers in Brussels in March. "Basically, we agree to the measures and we're backing this initiative, although we do have objections," said Mikloš. He noted that Slovakia agrees with five of the six proposed measures, with the unification of tax bases from company profits being the odd one out.

Source: TASR

Compiled by Zuzana Vilikovská from press reports
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