EU finance ministers agreed on a permanent support system for distressed eurozone countries on Monday. The deal will come into force in the summer of 2013. Finland would be required to pay 1.5 billion euros at the outset, following which it would commit to over 11 billion euros in loan guarantees.
Finland’s Finance Minister, Jyrki Katainen, praised the deal.
”I’m very satisfied with yesterday’s solution: it fulfils Finland’s goals. This bailout package means security for Finnish jobs,” Katainen said.
However, the Finnish parliament is currently in pre-election recess, and Finnish participation in the fund will be decided by the new parliament after April's elections. The issue has rapidly evolved into a deal-breaker for post-election coalition formation. Chair of the eurosceptic populist True Finns Party Timo Soini has said that his party will not support Finland’s involvement in the permanent fund.
“We will not vote for this, this is the True Finns’ position. We’ll see whether this closes the door to government for us,” Soini stated.
The current prime minister, Mari Kiviniemi of the Centre Party, has said that she will not enter into a coalition with the True Finns if they insist on rejecting all eurozone support measures. In an interview with the Financial Times, Kiviniemi said that Soini cannot enter government if he is serious about voting against all new aid or guarantee measures for eurozone countries.
Katainen has also said that the bailout issue is vital to the future coalition formation.
“I think it is quite inconceivable that the government and the parliament would overturn these solutions. All parties must be asked very seriously before the elections whether they are truly ready to single-handedly overturn economic stability, increases in investor responsibility and European solutions. This is quite irrational,” Katainen stated.
The main opposition party, the Social Democrats, declined to reveal its position.
“We are ready to state our position when we have enough information and when we know whether banks’ investor responsibility will be realised, which has been our condition,” SDP Chair Jutta Urpilainen said.
On Wednesday, Parliament’s Grand Committee will give its advice to the prime minister, who participated in the meeting of EU leaders. Further confrontations between the government and the opposition are anticipated.