The Slovak government is to offer a guarantee of $100 million to the state-owned company Vodohospodarska Vystavba to finance completion of the Gabcikovo dam. Final approval for the loan guarantee is to given after the 1998 state budget, Reuters reports.
A treaty for construction of the project was signed by Hungary and Czechoslovakia in 1977. However, Hungary pulled out in 1989 after pressure from environmental groups, and Slovakia decided to proceed alone.
Hungary has argued that Slovakia has illegally taken advantage of the river Danube, depriving Hungary of vital water resources.
The International Court in the Hague has ruled that the treaty between the two countries is still valid and that the two sides must work together to operate Gabcikovo jointly, taking into account both economic and environmental factors.