Slovakia should outperform the euro zone average growth

The Slovak government's forecast of 2.4 percent economic growth for 2009 is subject to downside risks stemming from uncertain outlook on major markets, the finance ministry's chief economist said on Tuesday.

Slovakia, a euro zone member since January, based its state budget on a growth assumption of 4.6 percent but the finance ministry has cut that projection given the deteriorating economic picture in key export markets, mainly Germany. "This year, the deficit should be around 3 percent of GDP, if the government does not compensate for the revenue shortfall (with measures) on the expenditure side," said Zdenko Krajcir, the chief economist . Finance Minister Jan Pociatek had said the government did not want to breach the limit fixed in the European Union's Stability and Growth pact.

Slovak growth, driven in the past by booming exports of cars and TV sets, slowed in 2008 to a preliminary 6.4 percent, from a record high 10.4 percent a year earlier, but it still remained one of the highest rates of economic expansion in the EU.
Even with the lower growth forecast, Slovakia should outperform the euro zone average this year as economic activity in the single currency area is expected to contract because of the global financial crisis.

Source: Reuters