Miroslav Beblavý is a former member of the Slovak parliament, head of an impact investment fund, and visiting professor at Sciences Po in Paris and the Hertie School of Governance in Berlin.
Slovakia urgently needs its economy to start growing again. If talk of economic growth sounds abstract, remember that the painful and protracted consolidation of public finances is happening precisely because the economy has been treading water.
Frozen public sector wages and rising social contributions are signs that we’ve lost the ability to generate new resources.
Fresh research by British and American economists shows that economic growth significantly increases public trust in the state.
It is no coincidence that Slovakia’s best social mood came in the summer of 2008, just before the financial crisis, after several years of rapid economic improvement.
When we look at what is preventing us from getting back on track, we see — compared to our neighbours — a specific kind of incompetence in how Slovakia was governed by Smer (with occasional help from Slovensko leader Igor Matovič).
Long-term handouts regardless of fiscal limits, expansion of the state apparatus, ever-higher taxation, and chronic inefficiency in using EU funds — all these problems are more pronounced here than among our more successful neighbours.
It may seem that all we need is a change of government, a correction of the worst mistakes, and the Tatra Tiger will once again descend from the mountains to impress Europe. In reality, the problem runs deeper — but solutions do exist.
A depleted growth model
Along with Hungary and the Czech Republic, Slovakia has long relied on two pillars — exports and foreign investment. In 1993, we exported goods worth seven billion US dollars — mostly “cheap” commodities such as steel and industrial semi-finished products.
