BRATISLAVA, September 17, (WEBNOVINY) — Growth of Slovak economy next year will be slower than originally expected, states the Finance Ministry in its latest prognosis of economic growth. The ministry’s Financial Policy Institute (IFP) has kept its prognosis of economic growth for this year at 2.5 percent thanks to the expected output of car manufacturers. However, the institute has cut next year’s prognosis by 0.5 percentage points to 2.1 percent. The reason behind it is in particular an expected weaker output of Slovak trade partners. Also, additional consolidation measures may further hamper economic growth.
The IFP explains that more pessimistic economic outlook of Slovakia’s trade partners would slow down economic growth. Consolidation measures necessary to achieve the general government deficit below 3 percent of GDP will hinder economic growth, too. In the following years, economies abroad should gradually recover, which will also positively affect outlook of the local labor market and demand. The institute has revised downward its estimates of economic growth in 2014 by 0.4 percentage points to 3.5 percent and in 2015 by 0.1 point to 3.6 percent. “The uncertainty surrounding the debt crisis in the eurozone is the main risk factor of the prognosis,” the institute adds.
The Finance Ministry does not bring positive news in the area of price development and the labor market, either. The estimated inflation for this year has been revised upward by 0.1 percentage point to 3.7 percent and next year by 0.6 points to 3.1 percent. Employment is expected to grow by 0.2 percent this year and by 0.1 percent in 2013. This year’s prognosis thus remains unchanged, while next year’s has been cut by 0.3 percentage points.
Unemployment rate will likely not drop next year and remain at this year’s 13.9 percent. A slight drop is expected in 2014 to 13.5 percent.
SITA
