Slovak economy

The centrally planned economy has been transformed to modern market economy since the establishment of the Slovak Republic in 1993. The government headed by the Prime Minister Dzurinda (1998 – 2006) imlemented major structural reforms and made contribution to macroeconomic stabilisation. Despite the recession in major market export, the country`s economic growth became the strongest in Central Europe. Foreign direct investors take advantage of Slovak market conditions and the total inflow of FDI was 2.54 billion in 2006.

One of the fastest growing sectors is automotive industry due to foreign investments of Volkswagen, Peugeot and Kia Motors. Slovakia`s car industry accounted for one-quarter of GDP and one-third of the country`s exports in 2007. Tourism in Slovakia has been in rise in recent years and its income has doubled.
The Slovak service sector employs altogether 44% of population. Services accounted for 64.8% of the GDP, industry for 31.4% and agriculture for 3.8% in 2006. Main industries with potential of growth are: Automotive, Electronics, Mechanical engineering, Chemical engineering, Information technology and Heavy industry. Around 40% of land is cultivated.
The main plant products are wheat, rye, corn, potatoes, sugar beets, grains, fruits and sunflowers, the principal animal production is based on breeding the cattle, pigs, poultry, sheep and goats. Wine growing and wine making belong to Slovakia`s traditional production. Slovakia’s major natural resources are antimony ore, mercury, copper, lead, zinc, manganese, iron, and lignite. In 2007, according to flash estimate, Gross domestic product increased of 10,3 % (at current prices of 11,5 %). If we subtract impact of special growth of volume of taxes on products the flash estimate of growth of GDP is 9,2 %. However the rate of unemployment remains comparatively high at 8%. Estimated inflation rate for 2007 is 2.5%. The currency of Slovakia is the Slovak crown, Sk (Slovak koruna). Slovakia is poised to adopt the euro in 2009. The Maastricht inflation criterion seems to be within reach. Growth prospects of Slovak economy are likely to enhance the rates expected in budget for 2007 – 2009.