Slovakia 

Slovakia country policy

Policy established 27 March 2001

• ILC, bank guarantee or central public guarantee (conditional)
• The country ceiling is 2000 mln euro
• Early warning signal 1500 mln euro
• - of which was used as at 2011-12-31 0 mln euro

Country class: 0

Slovakia country facts

Atradius Dutch State Business Economic Research 
Country Report last updated
November 10th, 2010 

Country: SLOVAK REPUBLIC  

Political Situation 

Stable

Head of state
President Ivan Gasparovic.

Form of government
Coalition of the conservative Slovakian Democratic and Christian Union (SDKU), liberal Freedom and Solidarity, etnic Hungarian Party and the Christian Democratic Movement, headed by prime minister Iveta Radicova

Internal Economic Situation
Recovering From Recession

General situation
Very open economy with high FDI: Slovakia has become the world’s top supplier of cars per capita due to its favorable business climate which has also attracted FDI in electronics, IT and engineering (skilled workforce, tax breaks). But the world recession of 2009 triggered a collapse in exports (-16.5%) and fall in real GDP by 4.7%. The 2010 real GDP-growth turns out to be well above expectation (Q1 +4.8%, Q2 +4.7% yoy) and is fueled by a moderate recovery of exports and the loose fiscal policy of the previous administration. Private consumption remains hampered by the high unemployment rate of >12%. Low rate of inflation: 2010Q2 1.1%. Solid banking sector, mainly privately (foreign) owned; because of a strong domestic deposit base banks are less reliant on foreign funding than some other EEC-economies.  
 
External Economic Situation
Reasonably Good

Main sources of foreign exchange
Machinery & transports, esp. cars: 53%.

Main foreign markets
EU (85%, of which Germany 34% and Czech Rep 14%).

Main expenses of foreign exchange
Machinery & transports (43%), fuels (12%).

 
Balance of payments 
Since 2002 exports have soared (cars, metals, machinery) but FDI-related imports increased faster, causing large current account deficits. In 2009 im-/exports dropped heavily, recovering again from this year on. After a dip in 2009 net-FDI will become positive again.