Investments, as of December 31, 2008
- The inflow of foreign direct investment from the Netherlands totalled €5,141 million and accounted for 19.9 percent of total foreign direct investments in Slovakia.
- This made the Netherlands the largest single source of foreign investment in Slovakia.
Foreign trade in 2008:
- Imports from the Netherlands to Slovakia: €616 million
- Exports from Slovakia to the Netherlands: €1,503 billion
Source: The Slovak Statistics Office
The main reason for the Netherlands ranking as the biggest foreign investor in Slovakia is the Dutch taxation system. When companies have their European headquarter legally based in the Netherlands, their investments elsewhere are not taxed there. This has drawn many companies to the country. Legally, therefore, some investments from companies which would not otherwise be regarded as Dutch are counted as investments from the Netherlands.
International companies of Dutch origin doing business in Slovakia include Heineken, Shell, and Philips. Dutch firms are also strong in financial services. Apart from banking (such as ING) these include accounting, taxation and insurance. Most Dutch companies active in Slovakia are small and medium-sized enterprises. There is also a lot of interest from companies active in the food and agricultural sector.
Dutch businesses are interested in Slovakia for many reasons. Geographically it has a central position in Europe. It borders countries directly to the east of the EU. There are a lot of investment opportunities, especially for smaller companies. The fact that Slovakia is now part of the EU and Schengen, and recently also joined the eurozone, makes it a very interesting country for Dutch companies to invest in.
It can, however, be a problem to find skilled labour, since some companies require very specific technical skills. Since Slovaks normally work where they live, it is not always easy to find enough people with the required skills in just one town. Another interesting asset of Slovakia is that salaries are still competitive in many sectors. A setback for companies that produce in Slovakia for export (most Dutch companies fall into this group) was the strong exchange rate set for the Slovak crown to the euro. This automatically made their products more expensive, and less competitive. For some companies this was a reason to move their production facilities out of Slovakia. On the other hand, for other companies the transition to the euro was excellent. It offers stability, clear pricing, and easier ways to settle budgets with parent companies.
In general the highest potential for future business is in areas concerning water (water treatment, flood prevention), waste and hydraulic engineering. The Netherlands has a lot of experience in these areas, and also in environmental issues. The Netherlands’ technology in these areas is very advanced and it therefore has a lot to offer to other countries that are also concerned about environmental issues.
Source: Royal Netherlands Embassy
15. Jun 2009 at 0:00 | Compiled by Spectator staff