Slovensko
A small country in the heart of Europe with beautiful scenery, tourism and hospitable people and automotive as the key sector
Total area: 49,035 sq km
Population: 5.4 million
Government type: Parliamentary democracy
Administrative division: 8 regions (called “kraj”)
Capital + other major cities: Bratislava (437,000) + Kosice (238,000), Presov (88,000)
Currency: Euro (since January 2009)
Languages: Slovak 81.8% (official), Hungarian 8.5%, Roma 1.8%, other 2.2%
Ethnicity: Slovak 83.8%, Hungarian 7.8%, Roma 1.2%, other 1.8%, unspecified 5.4%
Religion: Roman Catholic 55.8%, Evangelical Church of the Augsburg Confession 5.3%, Greek Catholic 4%, Reformed Christian 1.6%, other 3%, none 23.8%
President: (Mr.) Peter PELLEGRINI (since 16 June 2024)
Prime Minister: (Mr.) Robert FICO (since 25 October 2023)
Date of EU accession: 1 May 2004
KEY FEATURES
- The world’s leader in terms of car production per capita
- No. 6 worldwide in adapting to new technologies; high innovation potential for R&D projects
- Second CEE country to adopt Euro currency (2009)
- Proximity to other CEE markets – 350 million potential customers within a radius of 1,000 km (625 miles)
MACROECONOMIC OVERVIEW
Slovakia is a high-income advanced economy with a very high Human Development Index and a high standard of living. The country maintains a combination of a market economy with a comprehensive social security system. Although regional income inequality is high, 90% of citizens own their homes. Citizens of Slovakia are provided with universal health care, free education, and one of the longest-paid parental leaves in the OECD. The country joined the European Union on 1 May 2004 and joined the Eurozone on 1 January 2009. Slovakia is also a member of the Schengen Area, NATO, the United Nations, the OECD, the WTO, CERN, the OSCE, the Council of Europe, and the Visegrád Group.
Slovakia has experienced sustained and steady GDP growth since its integration into the European Union, except for the financial crisis and the Eurozone crisis in the second decade of the 21st century. In recent years, the Slovak economy has returned to growth, fuelled by the return of internal and European demand and driven by higher household spending and a recovery in investments. The Covid pandemic has particularly affected household spending which contributes significantly to GDP. The war in Ukraine has been reflected in higher energy prices and high inflation, which is being moderated by fiscal support for households and firms. Economic growth is expected to be driven by net export in the coming years.
Selected economic indicators, Slovakia, 2017 - 2023
| 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | ||
| GDP |
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| Real GDP growth |
%
|
2.9 | 4.0 | 2.5 | -3.3 | 4.8 | 1.9 | 1.6 |
| GDP at current prices |
€ bn
|
84.52 | 89.72 | 94.18 | 93.44 | 100.32 | 109.65 | 122.8 |
| Foreign trade |
|
|
|
|
|
|
|
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| Exports |
€ bn
|
80.38 | 86.21 | 86.77 | 78.67 | 91.16 | 108.62 | 112.28 |
| Imports |
€ bn
|
78.53 | 84.4 | 86.39 | 77.82 | 91.78 | 114.94 | 110.65 |
| Balance |
€ bn
|
1.85 | 1.82 | 0.37 | 0.85 | -0.62 | -6.32 | 1.63 |
| Prices |
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|
|
|
|
|
|
|
| CPI – average inflation rate |
%
|
1.4 | 2.5 | 2.8 | 2.0 | 2.8 | 12.1 | 11.0 |
| PPI – industry – average |
%
|
2.0 | 5.0 | 2.6 | 0.8 | 5.5 | 44.0 | 16.9 |
| Employment |
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|
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| Registered unemployment |
%
|
8.1 | 6.5 | 5.7 | 6.7 | 6.8 | 6.1 | 5.8 |
| Average monthly gross wage |
€
|
954 | 1,013 | 1,219 | 1,133 | 1,211 | 1,304 | 1,430 |
Source: Eurostat, IMF, Statistical Office of the Slovak Republic, 2017-2023
KEY SECTORS
The agriculture sector is less developed and represents only 2% of the GDP and 3% of employment, although almost two-fifths of the land is arable. The main agricultural products in the country are cereals, potatoes, sugar beets, and grapes. The mountainous area of Slovakia has vast forests and pastures, which are used for intensive sheep grazing, and it is rich in mineral resources including iron, copper, lead, and zinc.
The secondary sector represents 27.4% of the GDP and employs 36% of the workforce. Building on the long-standing tradition and highly skilled labour force, Slovakia’s key industries are Automotive, Electronics, Mechanical engineering, Precision metalworking, Chemical engineering, Information technology, Energy and environmental technologies, Defence and security products, Plastics, R&D, and medical equipment. High value-added industries, like electronics, engineering, and petrochemicals, are installed in the western part of the country. Heavy industry sectors – such as metal and steel – are still in a restructuring phase.
The services sector contributes 60.4% of the GDP and employs around 61% of the workforce. It is dominated by trade and real estate. The development of tourism may also become important for the Slovak economy in the coming years, as tourism is currently the country’s most dynamic sector. The country’s banking sector is strong and largely owned by foreigners.
Automotive sector
The automotive sector plays a major role in the Slovak manufacturing industry and accounts for almost 50% of its exports. Slovakia is the world's largest per-capita car producer with more than 1,000,000 vehicles manufactured in the country in 2021 alone, and the 5th largest vehicle producer in the European Union. The automotive industry accounted for 48% of Slovakia’s total industrial production and 12% of its share of GDP. The sector directly employs 15.7% of people. The local production of VW, Stellantis, Jaguar Land Rover, Hyundai, and a strong group of 350 automotive component manufacturers represent one-third of Slovak exports. In 2015, Slovakia manufactured more than 1,000,000 passenger cars for the first time in history.
Electronics and Electrical components industry
The electronics industry is the second-largest industrial sector and one of the strongest contributors to the country's GDP, with a share of 9.35% of the total industrial production. Among top multinationals active in the electrical and electronic industries, Foxconn has a factory in Nitra for Sony LCD TV manufacturing and Samsung Electronics in Galanta for computer monitors and television sets.
Chemicals & pharmaceuticals
the chemical sector is the third strongest sector of the Slovak industry and accounts for 10.2% of the total industrial production. The portfolio of the products is also influenced by Slovakia's strong automotive and electronics sectors. Chemical companies with the largest foothold include Slovnaft (the only oil refinery in Slovakia), Continental Matador (rubber and tires), Duslo (industrial fertilizers, rubber chemicals), and Zentiva (pharmaceuticals).
EXPORTS & IMPORTS
Slovakia is one of the most open economies to international trade in Europe, in fact, Slovakia’s exports/GDP ratio of 99.1% (2022) is the highest in the CEE. Slovakia trades primarily with fellow EU members – almost 80% of exports and imports are destined for the EU markets which is one of the highest shares in the EU.
2023 export and import data:
Main import partners:
Germany – 14.5%
Czechia – 10.2%
Other Europe, nes – 10.1%
China – 7.4%
Poland – 5.9%
Main export partners:
Germany – 21%
Czechia – 12.1%
Poland – 7.3%
Hungary – 7.1%
France – 5.3%
Austria – 5.1%
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