OECD: Slovak GDP to grow by 3.3 percent this year

Slovakia's economy is expected to maintain its growth this year before accelerating in 2018, according to the international organisation.

Illustrative stock photoIllustrative stock photo (Source: SME)

Slovak GDP should grow by 3.3 percent this year and by as much as 4.1 percent next year, the Organisation for Economic Cooperation and Development (OECD) wrote in its latest prediction on June 7.

The developments should be fuelled by strong domestic demand. In addition, improvements to the situation on the job market will contribute towards a rise in household consumption, the TASR newswire wrote.

Meanwhile, the unemployment rate is still expected to drop from the 9.6 percent of 2016 to this year's 8.5 percent. Next year, it should fall further to 7.6 percent, which would be the lowest figure since Slovakia became independent in 1993.

The OECD also expects private consumption to record sound growth, as it should rise by 3.1 percent this year and by 3.2 percent in 2018. Last year, it increased by 2.9 percent. Government consumption is projected to rise by 0.9 percent this year and by 1.9 percent next year after growing by 1.6 percent in 2016.

Export expected to be strong, with surplus

It is also expected that Slovak exporters will continue gaining market share, making it possible to post a modest surplus. Exports of goods and services are envisaged to rise by 6.8 percent this year and by 7.1 percent next year after recording a 4.8-percent rise last year.

Imports which expanded by 2.9 percent last year are expected to pick up and grow by as much as 6.8 percent both this year and next.

After falling by 0.5 percent in 2016, consumer prices should reverse the trend and resume growth this year. According to the OECD's expectations, the Harmonised Index of Consumer Prices (HICP) is set to go up by 1.6 percent this year and by 2 percent next year.

Public finances improving

The public finance shortfall is projected to fall from 1.7 percent of GDP in 2016 to 1.2 percent this year, and go all the way down to 0.6 percent in 2018. Public gross debt should decrease as well – from 59.1 percent of GDP in 2016 to 58.8 percent in 2017 and to 57.3 percent next year.

Government debt according to the Maastricht definition – which was at 51.9 percent of GDP last year – is also believed to be heading downwards; to 51.7 percent of GDP this year and to 50.2 percent in 2018.

In a bid to maintain the soundness of public finances, the Slovak government is planning to achieve a balanced budget in 2019, noted the OECD. To cover expenditures stemming from reforms aimed at enhancing inclusiveness, the government ought to improve tax collection and enhance public sector efficiency.

Top stories

PM Eduard Heger

Non-vaccinated will not pay for tests for work, school or shops

Hundreds of people protested against the amendment that the parliament passed on Sunday morning.


24. júl
Lawfirms provided legal advice pro bono related to the negative impact of the anti-pandemic measures on retail.

BUSINESS FOCUS: Demand for free legal advice increased in pandemic, pro bono specialists say

The use of AI in law firms, the CSR activities of law firms, an interview with Special Prosecutor Daniel Lipšic and gender equality in law firms are among the highlights of the latest Business Focus.


23. júl
Dancers perform in the streets of Trenčín, spotlighting the architecture of the city.

Slovakia will open a new institute, this time in Jerusalem

Culture, sports and travel stories rounded up in one place.


23. júl
The Office of the Public Defender of Rights flies the rainbow flag to mark the Bratislava Pride in 2021.

The pandemic has made it clear that we must stand together

International friends and partners of Slovakia celebrate Bratislava Pride.


24. júl