Standard & Poor's and Fitch Ratings agencies confirmed Slovakia’s rating at A+ with a stable outlook on Friday (July 27).
“Slovakia’s ratings reflect its sound macro-economic performance, supported by sustained, foreign capital inflows and European Union and Eurozone membership,” reads the Fitch rating action commentary.
Real GDP growth is in line with the current peer median and is expected to increase to 3.9 percent in 2018 and 4.2 percent in 2019, from 3.4 percent in 2017, writes Fitch. Solid household consumption will be bolstered by rising investment stemming from EU funds, and most significantly, the start of production at a new, large vehicle facility towards the end of 2018. Slovakia is the largest car maker on a per capita basis in the world, which could be damaged by potential US tariffs on imports of cars from the EU.Jaguar Land Rover will move all production of Discovery to Slovakia Read more
In its reaction, the Finance Ministry said that the rating confirmation is a result of long-term and fast economic growth, stability of the banking sector, as well as a healthy fiscal policy.
“With regards to the fact that Slovakia is the world’s leading per-capita carmaker, agencies see potential risks in the sector and geographic concentration, external factors stemming from the Slovak economy’s openness and potential overheating of the economy,” writes the Finance Ministry.
The rating agencies visit Slovakia regularly once a year in order to assess the country’s credit reliability. Based on meetings and relevant information provided to them, agencies assign a rating to the country that has a direct impact on the activities of investors, debtors, issuers and individual governments, recalled the ministry.