Slovak Republic: 2022 Article IV Consultation-Press Release; and Staff Report

June 30, 2022

Preview Citation

Format: Chicago

Slovak Republic: 2022 Article IV Consultation-Press Release; and Staff Report, (USA: International Monetary Fund, 2022) accessed September 19, 2024

Summary

This 2022 Article IV Consultation discusses that the war in Ukraine has clouded the outlook for the Slovak economy while it was still recovering from the pandemic. The effects of the war are already felt through surging commodity prices, input shortages, subdued confidence, weaker global demand, and heightened energy security risks, given Slovakia’s heavy reliance on Russian energy imports. Fiscal policy needs to be flexible and ready to adjust, while avoiding adding to inflationary pressures. The immediate policy priority is to mitigate the economic fallout of the war and minimize the humanitarian crisis. Rebuilding fiscal buffers should begin once the economy is on a solid growth path, to create room for maneuver and accommodate rising ageing-related spending. Recent reforms to the fiscal framework and the pension system could significantly strengthen public finances. The multiyear spending ceilings should strengthen fiscal discipline, while the link between retirement age and life expectancy will improve fiscal sustainability.

Subject: Financial institutions, Fiscal policy, International organization, Labor, Monetary policy, Prices

Keywords: Climate mitigation goal, Europe, Global, Housing prices, IMF's transparency policy, Inflation, Labor markets, Liability positions vis-à-vis nonresident, Money market rate, Mortgages, Policy priority, Policy recommendation

Publication Details

Pages:

73
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2022/202
Stock No:

1SVKEA2022001
ISBN:

9798400214684
ISSN:

1934-7685

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