Slovenia has become the second EU member state after Portugal to ratify the fiscal rule treaty, which was signed in early March by the leaders of 25 EU countries in a bid to enhance fiscal discipline in the long term and help prevent future crises.
The essence of the treaty is a rule requiring parties to bring their national budgets in balance or in surplus. While allowing for temporary violations in extraordinary circumstances, the treaty requires the golden rule to be transposed into national law, preferably at Constitutional level. The pact will enter into force once it is ratified by 12 eurozone members, if possible by 2013. The procedure for a enshrining the fiscal rule into the Constitution was launched in parliament last week. The final wording of the constitutional changes is presently being drawn up by the parliamentary Constitution Commission.
Also ratified today was the treaty creating the ESM, which aims to stop the spreading of the debt crisis in the common currency area. Operative as of July, the ESM will have an authorised capital stock of EUR 700bn. Its present lending capacity is at EUR 500bn, as EUR 300bn of the EUR 800bn agreed on by eurozone finance ministers last month for crisis protection has already been earmarked for aid to Greece, Ireland and Portugal. The ESM authorised capital stock will comprise EUR 80bn in paid-in capital and EUR 620bn in callable capital. Slovenia will chip in EUR 342m, of which EUR 137m will be paid in this year, while its total contribution - including guarantees and committed callable capital - will amount to almost EUR 3bn.
SOURCE: The Slovenia Times
