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The Slovak Republic is one of the most dynamic economies in the euro area. The country has continued to converge rapidly towards the living standards of advanced OECD economies. However, the Slovak Republic should continue on its path of reform to achieve balanced, fair and sustainable growth, according to a new OECD report.
The Slovak economy experienced a strong but short recession in 2009. The recovery afterwards was driven by exports and investment. While GDP growth was one of the strongest in OECD, employment did not reach the pre-crisis level and unemployment remains stubbornly high.
The challenge for fiscal policy in Slovakia is to achieve fiscal consolidation in a way which supports
the fragile recovery and protects spending on areas which are important for re-embarking on a trajectory of
high trend growth and underpinning a catch-up in living standards.
In Slovakia, educational outcomes are below the OECD average and are too dependent on the
socioeconomic background of students.
The priority for the Slovak Republic is to restore the sustainability of public finances while ensuring the prioritisation of funding for spending programmes which are important for growth, such as education and active labour market policies.
The Slovak Republic recovered strongly from the global economic crisis and is weathering well the storm that has struck its main European trading partners. The challenges going forward will be restoring public finances while driving down unemployment and fostering long-term inclusive growth, says the latest Economic Survey.
Country Notes from OECD Economic Policy Reforms: Going for growth 2011 presenting OECD recommendations for structural reform priorities for individual countries.
The transition to a greener economy supported by international environmental commitments and national policies will entail structural changes in consumption patterns and industry structures, resulting in a reallocation of resources in and between countries.
Raising efficiency in tax collection (notably VAT) is urgently needed, plans to unify the collection of tax and social security contributions should be implemented swiftly and drawing on EU funds needs to become more efficient.
The Slovak economy is swiftly recovering from the crisis. This Survey discusses the main challenges going forward: countering the risk of increasing long term unemployment, bringing government finances back on a sustainable path and reaping the benefits of a transition to greener growth.