The Slovak economy has recently been going through a challenging transformation process. A series of rather successful reforms helped Slovakia to join the world’s most developed economic organizations such as the OECD (2000) and the European Union (in 2004). Though it is not one of the richest countries belonging to the two elite organisations, Slovakia does not hide its ambition to seek rapid economic development.
There are several industrial sectors with a long and very successful tradition in Slovakia. During the era of the Austro-Hungarian Empire, Slovakia was one of the most economically developed parts of Hungary. Mining and metallurgy, concentrated in the traditional Spiš and Gemer regions of central Slovakia were especially well-developed. Great progress was achieved also in glass, machinery and food industry. After World War I Slovakia became the weaker member of the Czechoslovak Republic in economic terms and this disproportion has been preserved up until today. One of the positive aspects of the period between the two world wars was the strengthening of the industrial base in the eastern part of the then Czechoslovakia due to the strategic transfer of arms-production companies from Czech towns to the central Považie region. The most intensive industrialisation occurred in Slovakia under the Communist regime after World War II. The construction of new industrial companies changed the original agricultural nature of many regions. Special attention was given to the development of heavy industries with a relatively low share of final productin. Those years saw the emergence of mammoth companies such as the VSŽ metallurgical complex in Košice (today U.S. Steel) and the petrochemical giant Slovnaft in Bratislava. November 1989 was not only an important political turning point but it brought about enormous changes in the economic sector as well. The state-planned and controlled socialist economy was replaced with a standard market-oriented one. The private sector was given the green light.
Slovakia’s current economy is proceeding with mass restructualisation that aims to change the inherited unfavourable structure of production, to lure in foreign investments, cut the unemployment rate and gradually even up the great economic and social discrepancies between individual regions. One could well say that Bratislava has outclassed the rest of the country in all economic indicators. The quality of life in Bratislava compares with that of in the richest countries of the European Union, GDP par capita for the Bratislava Region amounts to 119.7 % of the EU average. The Bratislava Region, inhabited by one-seventh of the country’s total population, generates nearly one quarter of Slovakia’s GDP. For the sake of comparison, the Prešov Region with an approximately similar population generates only 10 percent of the country’s GDP. When looking at a map of Slovakia, one may clearly distinguish a better-off northern arch along the Váh and Nitra river from Trnava and Nitra to the Tatras and a poorer southern arch running through the regions of southern and eastern Slovakia from Levice to Snina.
Slovakia has to import several natural resources. The country is dependant on imports of oil, natural gas, iron ore and other raw material from Russia and the Ukraine. One of the related risk factors is the low diversification of these resources as there are no alternative importers. On the other hand, Slovakia benefits from the transit of oil and natural gas to western European countries. The lack of fossil fuels was resolved by the construction of nuclear power plants which currently produce more than a half of the total electricity generated in Slovakia. Slovakia was once rich in ore materials but due to exhaustion, mining has been significantly reduced over recent years. Non-ore materials such as magnesite, building stone, lime stone and vast supplies of wood represent Slovakia’s natural wealth.
Slovak industry is currently going through a phase of remarkable growth. The growth is expected to speed up even more rapidly in the years ahead as massive foreign investments into the country’s economy have already begun to bear fruit. Slovakia is gradually becoming one of the world’s leaders in the automotive industry. Two new car manufactures are soon to join the already well-established Volkswagen plant near Bratislava. The South Korean Hyundai/KIA concern is currently building a new production facility near Žilina, while French Peugeots and Citroens are to be manufactured in Trnava. By 2006, the Slovak automotive industry is expected to turn out more than 800,000 cars per year, which would give Slovakia the highest per-capita car production in the world. In addition to the traditionally well-developed engineering industry, Slovakia may likewise see perspective growth in industries focused on the production of building materials, glass, shoes, electronics, paper and wood processing. Slovakia still has large reserves in the so-called tourist industry since its great tourism potential has yet to be exploited in a sufficient manner. Yet the tourist infrastructure is improves year by year. The lack of promotional activities abroad has also had an impact on the relatively low number of tourist travelling to Slovakia. Agro-tourism and winter holidays offering good skiing opportunities appear to be especially promising since Slovakia has very favourable conditions for their further development.
Slovak agriculture is currently experiencing very difficult times. The agriculture is adversely influenced mainly by globalization-related problems, competition from countries with more favourable climates as well as the heritage from the Communist past. However, there are some agricultural cooperatives and companies which, having successfully passed through the transformation process, set an example worth following. Slovakia’s major foreign trade partners include Germany, the Czech Republic, the United States, Austria, Poland, Hungary, Russia and the Ukraine.
Slovakia’s transportation system is determined by the country’s location in the centre of the European continent. Slovakia is a typical transit country - its territory is criss-crossed by several international transport corridors. The Slovak railway system with a total line lenght of 3,657 km (of which 42,6 % is electrified) was established 150 years ago. Bratislava is the most important railway node in the country, lying on an international railway line connecting Prague and Budapest. It is also the starting-point of the major domestic railway line to Žilina and Košice (running through the Považie region along the Váh River). A total lenght of the public road network is 17,549 km, of which first-class roads account for 20 %. The network’s line-up and density is influenced by the natural character of the country. The Carpathian mountains represent a major natural obstacle which is easier to pass along the lines of latitude than those of longitude. Motorway network enlargement is one of the crucial strategic goals in respect of the country’s further development. Today, there are some 313 kilometres of motorway in operation but their total lenght increases year-by-year in order to link Bratislava with Košice and the Ukrainian border as soon as possible. The well-developed bus transport system is one of the most positive features of Slovakia’s public transport as regular bus lines go to virtually all towns and municipalities. There are 15 public airports in Slovakia. In addition to the M. R. Štefánik Airport in Bratislava, there are five more airports open for international flights (Košice, Poprad-Tatry, Sliač, Piešťany and Žilina). Two major river ports on the Danube (Bratislava and Komárno) serve ship transport.