The Slovak economy has demonstrated considerable resilience against negative shocks caused by the COVID-19 pandemic. It also withstood the impact of the war in Ukraine and the energy crisis. However, the Slovak Central Bank (NBS) identified public finances as its Achilles' heel.
"The crisis development called for the introduction of several support schemes financed either with domestic public resources or the EU's budget and led to an increase in public finance risks." informed the NBS. The indicator in question monitors the need to change the governance of public finances with an eye towards addressing the public debt of the country in the future. In Slovakia, it is driven up mostly by two factors: the high rate of the current public finance deficit and expected high costs caused by the ageing of the population.
"Our economy thus faces a profound challenge of the need to revive public finances, stabilise the mid-term growth of debt and prepare for future fiscal costs stemming from the ageing population," said the NBS.
Source: TASR
