BRATISLAVA (Reuters) - Four Slovak parties led by the leftist Smer have reached an agreement on sharing out portfolios in a new government, Prime Minister Robert Fico said on Wednesday.
The agreement is a significant step toward forming a coalition including three small centrist and right-wing parties, which will allow Fico to stay in power after his Smer party lost its parliamentary majority in a March 5 election.
"We have reached an agreement on the will to create a government coalition and on the arrangement of relations in parliament and the cabinet," Fico said after Wednesday's round of talks.
Smer will retain the post of prime minister, giving the 51 year-old Fico his third term since 2006.
It will also keep the finance ministry, which is widely expected to be run again by Peter Kazimir, respected for keeping budget deficits under control and known for his tough stance in the euro zone's negotiations with Greece.
Slovakia will hold the rotating EU presidency in the second half of the year, giving the strongly anti-immigration leader Fico a bigger voice on issues ranging from the refugee crisis to the aftermath of Britain's referendum on leaving the EU.
On March 5 Smer lost its one-party majority, winning only 49 of the 150 seats in parliament, and seemed at risk of losing power with seven other factions with diverse agendas winning seats.
But the talks on a new cabinet have progressed surprisingly smoothly given the stalemate.
Six center-right parties could have formed a politically less diverse coalition but such a grouping would have involved two protest movements, and analysts said it could have been more unstable than a right-left coalition under Fico.
The conservative Slovak National Party pulled the plug on the center-right at the weekend, saying it wanted a deal with Fico. That swayed two other small centrist factions, Most-Hid (Bridge) and Siet (Net), into Fico's camp.
The coalition agreed its agenda on Tuesday, including moderate cuts in taxes for corporates and small entrepreneurs, and a balanced budget by the end of its term in 2020.
It has also agreed to tackle shortcomings in healthcare and education and increase transparency on government and public spending, a major concern for people who voted for opposition parties hoping they would oust Smer from power.
Fico said talks would continue on Thursday and he hoped to present a final deal soon to President Andrej Kiska, who has the right to appoint governments.
The four parties together have 85 votes in parliament but four deputies from Siet and Most have said they would quit their factions in protest against teaming up with Fico, giving the coalition 81 seats.
Reporting by Tatiana Jancarikova; Writing by Jan Lopatka; Editing by Hugh Lawson