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Austria set to ratify ESM bailout fund this week
July 2, 2012 / 7:41 AM / 5 years ago

Austria set to ratify ESM bailout fund this week

VIENNA, July 2 (Reuters) - Austria is set to ratify the euro zone’s ESM permanent bailout fund this week after the government and the opposition Greens said on Monday they had reached an agreement that would allow them to recommend it to their parliamentarians.

The Greens, who are needed by the centrist ruling coalition for a two-thirds majority in parliament, said they had won key concessions on giving parliament a say in how the ESM is run, and on a European financial transactions tax.

The 500 billion euro ($634 billion) ESM fund must be approved by countries accounting for 90 percent of the capital base of the euro zone, but only a handful of the euro zone’s 17 countries have approved it so far.

Germany’s parliament voted in favour of ESM on Friday but risks missing an already delayed July 9 deadline on July 9 because the country’s constitutional court must give its approval, which could take weeks.

The Austrian parliament is now expected to ratify ESM on Wednesday. Austria accounts for under 3 percent of the euro zone’s capital base but could play a role if other small countries baulk.

The parties said on Monday they now had 10 euro zone countries on board to bring in a financial transactions tax, which is designed to curb financial markets speculation and was a key demand of the Greens.

“The fact that states are getting together and want to jointly bring in a financial transactions tax is already a big success,” Green party leader Eva Glawischnig told journalists.

$1 = 0.7880 euros Reporting by Georgina Prodhan and Angelika Gruber; Editing by Toby Chopra

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