By Martin Santa and Jan Lopatka
October 13, 2011 12:25 PM EDT
Slovakia's parliament ratified a plan to bolster the Eurozone's EFSF rescue fund on Thursday, after voting to hold an early election as demanded by the opposition.
A junior party in the country's ruling coalition torpedoed the cabinet on Tuesday in a confidence motion connected with ratification of the plan to give the European Financial Stability Facility (EFSF) more powers to fight the debt crisis.
The failed attempt had rattled financial markets. The opposition committed to provide votes for the EFSF in a repeated vote, once the early election plan was approved.
Slovakia was the only one of the 17 countries using the euro single currency that had not approved giving the rescue fund more powers, a measure European leaders say is urgently needed to save the currency zone from financial ruin.
The difficulty ratifying the EFSF expansion in Slovakia is a sign of the challenges European leaders face responding to the debt crisis across 17 countries that must all act unanimously.
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With 5.4 million people, Slovakia accounts for less than 2 percent of the currency bloc's population and 1 percent of its output, but its parliament could effectively veto the measure.
The delay in enacting the July deal comes even as other leaders are wrangling over further steps to protect euro zone banks if Greece defaults on its debts.
The EU will hold a summit on October 23 to adopt more measures to counter the crisis.
ELECTION
Under a constitutional law approved on Thursday, a general election originally planned for 2014 will be moved to March 10 next year, meeting the leftist opposition Smer party's main demand for its support of the EFSF.
European Commission President Jose Manuel Barroso said earlier he was confident Slovakia would approve the plan, and that this would not be a problem for EU leaders when they meet on October 23.
"I hope that this is going to find a solution, and I am told, the latest reports we have received from Slovakia, is that there is now a consensus or a majority in favor of a solution, and I welcome that," Barroso told reporters in Brussels.
"So I don't think that this will be a problem for the European Council. I am anticipating a positive outcome."
Agreement on Wednesday between Smer and the three governing parties -- Prime Minister Iveta Radicova's SDKU, the Christian Democrats, and the centrist Most-Hid -- caused the euro and global stocks to rally, reversing a selloff that had gained speed on fears that the measure might not go through.
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