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 Travel TipsSlovakia
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Thursday 29, September 2005, Local time in Slovakia |
Here you will find the most important informations
about Slovakia
| Slovakia most important informations |
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ECONOMY
Of all the Soviet bloc economies, the former Czechoslovakia experienced the highest degree of state control. In the late-1960s, after the Prague Spring, the Soviet-backed government revamped the economy to build up heavy industry at the expense of traditional strengths in light and craft-based industries, such as textiles, clothing, glass and ceramics. After the division of Czechoslovakia in 1993, the newly independent Slovak government found these heavy industries to be something of a millstone, but they continue to play a central role in the economy. In a few cases, they have benefited from foreign investment. The other major economic problem was a dearth of natural resources: the most important of these, especially oil, were formerly available cheaply from the ex-Soviet Union but now had to be bought at market rates. The agricultural sector – almost all of which is now privately owned – produces wheat and grains, sugar beet, vegetables and livestock. However, its relative economic contribution (5 per cent of GDP, 8 per cent of the workforce) is not substantial. The bulk of the industrial economy has been transferred to the private sector, including the key areas of machinery and chemical industries, textiles, leather, shoes, glass, electronics, nuclear energy and car manufacturing. Slovak economic policy-makers chose a different path of development from their Czech neighbors, opting for a more gradual transition and retaining certain ‘strategic’ industries (notably the armaments industry) under state control. An estimated 85 per cent of the economy is now in private hands.
After the initial transition shock, the economy performed fairly well in the mid- and late 1990s, but then went into recession. Growth stagnated while the budget deficit, external debt and unemployment climbed to uncomfortably high levels. Since 2002, however, the situation has been brought under control. Growth has now resumed at between 4 and 5 per cent. Unemployment remains stubbornly high at 17.8 per cent; inflation in 2003 was 8.8 per cent.
Current Slovak economic policy is focused on turning the 15 per cent or so of the economy still controlled by the state over to private ownership, and reforming the republic’s still rigid employment code. Both measures are integral to the Slovak Republic’s forthcoming accession to the European Union. After signing an association agreement with the EU in October 1993, the country had fulfilled the membership criteria for the EU by the end of 2002. Along with nine other countries (including seven others from East and Central Europe), the Slovak Republic joined on May 1 2004, a decision endorsed by popular referendum during 2003.
Almost two-thirds of Slovak trade is now with the EU’s 15 existing members. Otherwise, there remain important links with the other members of the Visegrad Group of central European states (Poland, the Czech Republic and Hungary – all of whom also joined the EU), as well as the Russian Federation and Ukraine. |
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