The week-long strike at Bratislava-based carmaker Volkswagen Slovakia has significantly impacted the export numbers for June.
The total export of goods amounted to €6.2258 billion, down by 4.6 percent compared to the previous month, while the imports amounted to €5.7768 billion, which was 6.6 percent lower than in May.
“The detailed structure of June exports will be published next month, but the main suspect is indisputable – the week-long strike at Volkswagen cut the June production and exports of the Slovak automotive sector,” analyst with UniCredit Bank Czech Republic and Slovakia Ľubomír Koršňák wrote in a memo.
This also impacted the imports of materials and semi-products for production, Koršňák said.
Another important factor impacting foreign trade was the oil price.
In annual terms, however, both exports and imports grew, each by 0.9 percent, according to data from the Statistics Office.
The foreign trade surplus amounting to €449 million came as a surprise. This was been the highest since last August and is comparable to that of June 2016. This means that the reduction of foreign trade surpluses stopped in June, and the 12-month surplus remained unchanged, amounting to 4 percent of GDP, Koršňák said.
With the impacts of Easter and the strike in Volkswagen Slovakia, foreign countries probably did not contribute much to the increase in the Slovak economy in the second quarter of the year, according to the analyst.
“The increase of both exports and imports nearly stopped,” Koršňák said.
The GDP growth was thus probably most impacted by household consumption, he added.
As for the following months, Koršňák expects the foreign trade surpluses to be lower, particularly at the end of this year.
“This drop in surpluses will only be temporary, though, and will pertain particularly to the imports of technologies linked to big investments in the automotive sector,” Koršňák explained.
After the production launch of the new carmaker, Jaguar Land Rover, the foreign trade surpluses are expected to rise again in the second half of 2018 and the whole of 2019, he added.
He also expects the positive foreign trade balance to drop from last year’s 4.5 percent of GDP to 3.7 percent this year. In 2019, however, it should rise to 5 percent of GDP.