The surprisingly high growth recorded in Slovakia's GDP for the final quarter of 2011 (3.4 percent year-on-year) brings a more optimistic outlook for 2012, the Slovak central bank (NBS) indicated in a statement released on February 15, the TASR newswire reported.
"When hypothetically counting on maintaining the GDP output of 4Q 2011 throughout 2012, with the quarter-on-quarter dynamics staying zero, Slovakia's economy may rise by 1 percent y-o-y in 2012," the NBS stated, as quoted by TASR, while adding that if the latest trends of falling receipts in retail and the deterioration of consumer trust continue the country's economic output will decline. The ongoing process of consolidation of public finances will not aid enhanced consumption and the only factor that may contribute towards growth is investment by private companies but this is not expected to increase, the NBS wrote.
There is a possibility for higher-than-expected growth in Slovakia's GDP in 2012, according to a Finance Ministry statement also released on February 15. "The published data have introduced positive factors to the latest macroeconomic prognosis for 2012, which counts on 1.1-percent growth in 2012," stated Finance Ministry spokesman Martin Jaroš, as quoted by TASR. The most recent ministry prognosis for the fourth quarter was only 0.3-percent growth while the European Commission had predicted no growth in the quarter. The eurozone recorded a fall in aggregated GDP of 0.3 percent in the quarter. Slovakia's most important foreign trading partners, Germany and the Czech Republic, also saw declines in their fourth quarter GDPs.
Analysts were surprised by the preliminary estimate in GDP growth. "Our estimates were indicating a significantly slower pace of growth, just over the 2-percent mark," Poštová Banka’s analyst Eva Sadovská told TASR. She believes the Slovak economy was boosted particularly by foreign demand in 4Q11. UniCredit Bank’s chief economist Vladimír Zlacký said the NBS figures show that the Slovak economy enjoys a relative amount of resistance to deceleration in Western Europe. He expects a further recovery in economic growth this year after a weaker first quarter.
Compiled by Zuzana Vilikovská from press reports
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