First Slovakia refused to participate in Greece's euro-backed bailout and now the two countries have diverging opinions on the future of the Stability and Growth Pact, an agreement on how countries manage their debt.
At a meeting with the Slovakian prime minister in Berlin on Wednesday (25 August), the German chancellor took a conciliatory approach to Slovakia's decision and refrained from criticising Radičová.
Since the Slovakian refusal, there has been further disagreement between the two heads of government regarding financial regulation in the euro zone.
Nine European countries had recently filed a request to change the criteria of the Stability and Growth Pact, which governs budget discipline in the countries that use the euro.
Bulgaria, the Czech Republic, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Sweden (EurActiv 18/08/10) wanted recent pension reforms to be taken into account in the EU's draft budget rules.
The countries argued that pensions were likely to inflate the budget in the short run but benefit the economy in the long term, and therefore they should not be taken into account when calculating the budget deficit, which the Stability and Growth Pact sets at 3%.
According to reports from EurActiv Germany, on Wednesday Merkel refused any changes to the criteria, as she feared an erosion of the Stability and Growth Pact at a time when the opposite was needed.
Instead, she proposed better sanctions to enforce the pact's terms. But this poses yet another problem as further sanctions would require treaty change, an eventuality that is highly contested given the time it took to ratify the Lisbon Treaty.
A statement made by Radičová in Berlin indicates that the episode may not augur well for Slovakia’s relations with the Commission.
Speaking to the press after talks with Merkel, the Slovak prime minister said that Economic and Monetary Affairs Commissioner Olli Rehn should apologise for having criticised Bratislava's refusal to provide aid to Greece (see 'Background').
Rehn was speaking outside his competency because it's not the place of an EU commissioner to comment on sovereign political matters, Radičová insisted.
Amadeu Altafaj Tardio, spokesperson for Olli Rehn, said the decisions of the Slovakian parliament would be respected even when the Commission did not agree with them.
