Development in car industry worries Slovakia as well as Germany

Slovakia mimics economic development of its most important trade partner.

Illustrative stock photoIllustrative stock photo (Source: SME)

Even though German companies in Slovakia and Germany perceive the current economic situation in a prevailingly positive way, they are more sceptical in terms of the future. While only 16 percent of companies expect economic growth in the next 12 months, the share of optimists in the European Union is 34 percent on average, showed the regular autumn survey of German chambers in the European Union.

Peter Kompalla, executive director of the German-Slovak Chamber of Commerce (SNOPK), ascribes the gap between expectations to intercultural differences when Slovakia as well as Germany are more pessimistic nations compared to others, but also to the current development in the automotive industry. Car production is an important economic pillar for both Germany and Slovakia.

“The mood in the automotive sector in Germany is more tense,” said Kompalla.

This is because this sector is under pressure due to the adopted climate politics aimed at the reduction of CO2 emissions, where the demand for more environmentally friendly cars are not as high as desired. Moreover, German carmakers are simultaneously very dependent on the Chinese market, which however is very weak in the time being, with an annual decline in car sales of 20 percent. On the other hand, sales in Europe and US remain stable.

Related articleSlovak economy keeps decelerating Read more 

Yet the latest statistics indicate a positive development when Eurostat data confirmed economic growth either for Germany as well as Slovakia in the third quarter of 2019. The German economy avoided falling into recession in the third quarter by registering a meagre 0.1 percent growth quarter to quarter while Slovakia grew 0.4 percent q-to-q.

“More and more indicators imply that the German economy is getting into shape again,” said SNOPK president Peter Lazar. “This is a good news for the Slovak economy.”

Slovakia closely linked to German economy

“Since the economic crisis from 10 years ago, the economic growth in Germany and Slovakia is more or less synchronous,” explained Lazar, adding that this is due to the close economic interconnection between two countries. “Germany is the most important trade partner of Slovakia and one of the main countries in terms of origin of investments.”

The rest of this article is premium content at Spectator.sk
Subscribe now for full access

I already have subscription - Sign in

Subscription provides you with:
  • Immediate access to all locked articles (premium content) on Spectator.sk
  • Special weekly news summary + an audio recording with a weekly news summary to listen to at your convenience (received on a weekly basis directly to your e-mail)
  • PDF version of the latest issue of our newspaper, The Slovak Spectator, emailed directly to you
  • Access to all premium content on Sme.sk and Korzar.sk

Get daily Slovak news directly to your inbox

Top stories

Health Minister Marek Krajčí and PM Igor Matovič shaking hands in front of cargo plane with Sputnik V supplies on March 1.

News digest: Politicians welcome rolling review of Sputnik V, but coalition crisis not solved

Former state secretary released from prison and immediately detained again. France will donate 15,000 AstraZeneca vaccines to Slovakia.

2 h
Teh formet Prologis Park Nitra.

Pandemic has made logistics real estate attractive for investors

Online shopping leaves lower carbon footprint than in-store trips.

2 h
Psychiatrist Péter Hunčík criticises non-transparency in Orbán's subsidies.

Matovič should bear in mind that Orbán courts Slovakia's Hungarians

A Dunajská Streda psychiatrist on how Hungary's PM Viktor Orbán chases after voters in Slovakia.

11 h
The representatives of Za Ľudí after the March 3 meeting of the coalition council.

The fate of the coalition remains unclear after evening meeting

Talks will continue, Sme Rodina will meet only next week.

9 h