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Počiatek: Gas crisis will slow Slovak economy by 1-1.5% of GDP

According to the first estimates, the gas crisis will have a considerable effect on the Slovak economy, causing a slowdown of 1-1.5 percent of GDP this year, Slovak Finance Minister Ján Počiatek said at a meeting of the EU Council for Economic and Financial Affairs (ECOFIN) in Brussels on January 20.

According to the first estimates, the gas crisis will have a considerable effect on the Slovak economy, causing a slowdown of 1-1.5 percent of GDP this year, Slovak Finance Minister Ján Počiatek said at a meeting of the EU Council for Economic and Financial Affairs (ECOFIN) in Brussels on January 20.

The European Commission (EC) published its first economic estimates for EU countries on Monday, indicating that it believes economic growth in Slovakia will fall from 7.1 percent in 2008 to 2.7 percent this year.

Počiatek said he doesn't think that the 1-1.5-percent figure he quoted should be deducted from the EC's figure. He said he will wait for the Slovak Finance Ministry's own estimates, which should be published in February.

Počiatek descried the EC's latest prognosis as ‘too gloomy’ and noted that the economic crisis was supposed to last much longer than had been predicted before now. This would deepen the effects on real economies and unemployment and lead to a deep recession. "In any case, the message is very clear. The whole of Europe is heading for a recession and this will bring a number of subsequent complications. We have to add the effects of the gas crisis in Slovakia," noted Počiatek, who didn't want to specify how the ministry would adjust its calculations, but conceded that they would go down, and probably radically.

Počiatek also refused to predict whether Slovakia would fall into a recession, claiming that this was a question for a "crystal ball". "Everything depends on how deeply the recession affects the rest of our business partners. We're hugely dependent on exports, [in particular] the car-manufacturing industry, which [propelled] Slovakia's economic growth in the past and is now in a deep depression world-wide. The figures are alarming, and now Slovakia's huge handicap is showing up - that it is solely dependent on one large sector that is among the most affected," he added.

Compiled by Zuzana Vilikovská from press reports
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