Books on Slovakia
% of GDP
Update No: 104 - (01/01/06)
The Slovak Prime Minister, Mikuláš Dzurinda, is becoming a major figure
on the world stage. He's basking in the glory of his reform programme, widely
seen in the US and the EU as a model of its kind.
He started it immediately after assuming the premiership in 1998 and was
re-elected, admittedly as head of a coalition of parties, in 2003, a rare feat
in the post-communist world.
Slovak economy growing fast
His achievements have helped to facilitate a dynamic economy, which is also
greatly assisted by Slovakia's central position in Central Europe, attractive to
foreign investors, such as French and German motor manufacturers, and low wage
and other costs.
The Slovak economy is experiencing its greatest rate of growth in the past
decade. The Slovak Statistics Bureau has confirmed its forecasts and announced
that in the third quarter of 2005 the gross domestic product (GDP) grew by 6.2
per cent year-on-year. Slovakia thus ranks as the fastest growing economy in the
region, the SME daily wrote.
Economic growth is being driven by exports and increased household consumption.
Economists have warned, however, that this GDP growth structure carries the risk
of economic overheating. In particular, rising domestic consumption could result
in growing prices. According to VÚB bank analyst, Mária Valachyová, the
Slovak central bank could try to tame local consumption by increasing key
The growth of the economy has had a positive impact on the creation of new jobs.
In the third quarter of the year, 2.24 million people in Slovakia had jobs, a
rise of 36,000 year-on-year. The unemployment rate decreased 1.9 per cent
year-on-year to 15.6 per cent.
The average wage in the national economy increased by 7.6 per cent in real terms
to Sk16,816 (441.7 Euro) a month, still very low by Western European standards.
Dzurinda offers help at EUROMED
Dzurinda attended a conference of the Euro-Mediterranean Partnership, EUROMED,
in Barcelona in December. The attending prime ministers agreed that a free trade
zone should be formed between the European Union and the Mediterranean countries
(Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, the Palestinian Authority,
Syria, Tunisia and Turkey) by 2010, the SITA news agency wrote.
Dzurinda said the proposal is important for the further development of economic
relations between EU member states and non-EU Mediterranean countries.
Slovakia wishes to be involved in the development of such cooperation, the PM
said, hoping that his country can also find its place in these markets. Slovakia
could also offer its experience in building a market economy and democracy, he
Extremists demonstrate outside Austrian and Slovak embassies in Prague
In December a bizarre event showed that not everyone in Europe is beaming at
Slovakia, nor at Austria either.
Some 50 far-right extremists staged a demonstration outside the Austrian embassy
in Prague to express their support to British historian, David Irving, who has
been recently arrested in Austria for denying the Holocaust.
Opponents of the demonstration, that was permitted by authorities, tried to
thwart the protest by ringing bells. There were Jewish community representatives
and former concentration camps prisoners among them.
"There is the Vltava River here and not Jordan," neo-Nazi David
Machacek, the organiser of the protest, said.
The protesters later moved to the Slovak embassy where they protested against a
Slovak police crackdown on the ultra-nationalist Slovak Community-National
Party, whose leader Marian Kotleba and a number of members have recently been
charged with support to extremist movements. It is rare for a woman to go in for
far rightist policies but democracy makes for strange, and not always
comfortable bed-fellows. If she and Irving got married, they would have curious
children no doubt.
Four investors bid for Slovakia's main airports
Operators of airports in Vienna, Istanbul, Cologne and Belfast submitted bids
recently for two fast-growing Slovak airports slated for sale by the government.
A Slovak transportation ministry spokesman named the finalists but gave no
details on the bids for the MR Stefanik Airport in the capital, Bratislava, and
Kosice Airport in the east. The government would name a winner by the end of the
year, said spokesman Tomas Sarluska.
Among the significant players bidding for the government's 66 per cent stake in
each airport were Airport TwoOne, an Austrian-Slovak consortium led by Vienna's
airport operator Flughafen Wien, and ISAP, a Slovak-Austrian-German consortium
which also involved the participation of the operator of the Cologne-Bonn
Turkey's TAV which runs Istanbul's Ataturk Airport, though late, also took part
in the race. Also a group led by Spain's Albertis Infrastructures that included
Slovak investors teamed with the operator of the Belfast and London Luton
airports TBI submitted their bid.
A consortium of France's Vinci Concessions and Austria's Away bowed out of the
race in November following media reports that they might have broken tender
rules by working with the Austrian bank Raiffeisen, which was also reportedly
backing Airport TwoOne.
Sarluska said a government commission agreed with a recommendation of its
privatisation adviser Meinl Bank to exclude Vinci-Away but allow Airport TwoOne
to compete. TwoOne earned the reputation as a leading bidder thanks to its plan
to link airports in Vienna and Bratislava, about 50 kilometres apart. However
that plan too was opposed by one of Bratislavas biggest airlines, Ireland's
budget carrier RyanAir.
The Bratislava and Kosice airports have been expanding rapidly. After handling a
combined 1 million passengers last year, mainly through budget airlines, the
Bratislava field saw traffic increase 50 per cent in the first half of this year
while Kosice's passenger traffic rose 14 per cent.
Economy kicks into gear as GDP tops 6%
Slovakia's gross domestic product grew at a higher-than-expected 6.2 per cent in
the third quarter, according to a government "flash estimate"
published recently, setting the tone for what analysts say may be a six per cent
growth for the next two years.
The expanding economy of the so-called "Tatra tiger" country has been
growing quickly since bottoming out in 1999, when GDP grew by just 1.5 per cent.
The last time GDP topped six per cent was in 1996. Gross domestic product
totalled 365 billion Slovak crowns (US$11 billion) in the third quarter, up 6.2
per cent from the same period last year and 1.1 per cent higher than previous
government estimates, the Slovak Statitical Office (SUSR) reported.
Analysts noted that the engineering sector and a forward push in per-capita
income which lead to a surged spending spree helped the economy to accelerate
during the three months to September. The Slovak Finance Ministry expects 5.4
per cent growth next year and six per cent in 2007. Estimates for 2005 GDP range
from five to 5.3 per cent, but recent figures indicated the estimates might be
too low. SUSR had expected third-quarter GDP of only 5.1 per cent. Slovakia's
GDP has been rising steadily, from 4.2 per cent in 2003 and 5.5 per cent last