Slovenia 'agrees' with EU criticisms

(LJUBLJANA) - Eurozone member Slovenia's government said Wednesday it was working to resolve problems outlined in a stark warning by the European Commission that "urgent action" was needed to tackle imbalances.

"The government's priorities address the challenges underlined by the European Commission," the finance ministry said in a statement.

"The government is resolute and agrees with the Commission that the top priority should be restructuring the banking sector, ensuring better governance of state-owned companies, including privatisation, and continued consolidation of finances," the statement added.

It added that two-million-strong Slovenia, once a model newcomer to the EU but now favourite to be the next eurozone member to need a bailout after Cyprus, has already adopted a series of measures and planned a fresh budget revision.

Warning that Spain and Slovenia posed the biggest economic risks at present, the Commission said Wednesday that "urgent policy action is needed to halt the rapid build-up of ... imbalances and to manage their unwinding."

Alenka Bratusek, prime minister since only last month, said on Tuesday after meeting Commission head Jose Manuel Barroso that her government was already working "day and night" to shore up the banking system, which is struggling with large volumes of bad loans.

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