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Slovenia ratifies EU budget treaty

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(LJUBLJANA) - Slovenian parliament on Thursday overwhelmingly ratified a new European Union treaty tightening budget discipline.

The country's 90-seat parliament approved the pact, the EU's rampart against the debt crisis, with 74 votes in favour out of the 76 lawmakers present at the session. Two MPs did not cast their votes.

The assembly also approved the European Stability Mechanism, a firewall fund and the second new line of defence against debt contagion.

Under the rules of the pact, nearly automatic penalties will be applied against countries which allow their annual budget deficits to breach agreed limits.

The pact lays down a maximum structural deficit of 0.5 percent of gross domestic product, a maximum public deficit (including cyclical factors) of 3.0 percent of output, and a ceiling for debt of 60 percent of output.

Slovenia, the third EU country to ratify the new rules, has been hit hard by financial crisis and the new centre-right government has launched a package of austerity measures aimed at cutting the eurozone country's deficit to 3.5 percent of gross domestic product this year from 6.4 percent in 2011.

Slovenian parliament earlier this month started the procedure for changing the country's constitution in order to include a golden fiscal rule forcing the government to budgetary discipline.

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