Slovak Republic: 2023 Article IV Consultation-Press Release and Staff Report
IMF Staff Country Reports, March 13, 2024
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- Slovak Republic: 2023 Article IV Consultation-Press Release and Staff Report
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Bibliographic details
- Published: March 13, 2024
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400270963.002
Economic performance and near-term drivers
- The economy slowed in 2023 as the drawdown of pandemic-era savings ran its course and negative real wage growth weighed on consumption.
- The Slovak economy continued to grow in 2023, with a large fiscal expansion and the easing of pandemic-era supply chain disruptions offsetting headwinds from soaring food and energy prices.
Inflation and monetary environment
- Inflation has declined from comparatively elevated levels in 2022 and early 2023 but remains among the highest in the euro area.
Fiscal outlook and policy recommendations
- Adverse demographic trends pose medium-term challenges for growth and fiscal sustainability.
- Fiscal consolidation is needed to reverse the structural deterioration in public finances and the upward trend in debt ratio, and build space for future spending pressures.
- Fiscal consolidation beyond what is envisaged in the budget is needed in 2024 to start the process of rebuilding buffers and contain gross financing needs.
Structural reforms and medium-term priorities
- Structural reforms are needed to:
- raise inclusive and climate friendly growth,
- tackle demographic challenges,
- address regional income inequalities,
- accelerate the green transformation.
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- 1svkea2024001