FinMin: Slovak economy shrank by 5.8% in 2020, slight growth expected in 2021

Slovakia's economy contracted by 5.8 percent in 2020, Finance Minister Eduard Heger (OĽaNO) reported on Wednesday. The fall in GDP was more moderate than expected, which is good news, said Heger, ascribing this mainly to a stronger labour market. The finance minister expects GDP to grow by 4.3 percent this year and by 3.9 percent in 2022. According to Heger, the stronger labour market was ensured by the fact that industry provided sufficient employment. Foreign trade revived much faster in the third quarter, mainly due to car manufacturers. The economies of Slovakia's trading partners dropped less. As Slovakia is a small open economy, the secondary effect was felt here as well, added the minister. Finance Policy Institute (IFP) director Eduard Hagara said that the future forecast also includes the arrival of the second wave of the pandemic. For 2021, the drawing of a billion-euro reserve to help the economy is also included, and the forecast also involves the impact of the recovery plan on growth, which, according to the Hagara, is estimated at 0.4-0.5 percent in 2021-2023.