Forecasting the competitive environment of Slovak export goods, Vladimír Masár, governor of the Slovak National Bank (NBS), had this to say: "In addition to keeping the prices of their products low, Slovak export companies should begin to rely more on quality, Masár said. "The competitive advantage of depressed wages and a favorable currency exchange rate will soon diminish. At present, approximately 50 percent of Slovak exports succeed in foreign markets thanks only to their low prices, and in only 24 percent of Slovak exports did quality matter in foreign partners' decisions.
Masár also offered a recipe for success. "The best market maneuver to support exports would be to switch to a floating Slovak crown exchange rate. The problem is, though, how Slovak export companies would handle this type of exchange rate, since the Slovak financial market lacks the tools to minimize exchange rate losses [such as hedging, options or forward trades]."
