Slovakia External Debt (EUR bn)

Growth moderated in Q4. A significant deceleration in exports more than offset improvements in private consumption, public spending and investment. For 2022 as a whole, GDP grew 1.7%, well below its 10-year pre-pandemic average of 3.1%. Turning to Q1 this year, early signs are mostly downbeat. In January, industrial activity contracted faster than it did in Q4, while in January–February, inflation accelerated, hitting real incomes. That said, a small rebound in annual retail sales growth in January compared to the Q4 average points to the resilience of private spending. In politics, early elections have been called for 30 September. Current Prime Minister Eduard Heger recently launched a new pro-Western party while Robert Fico, a former prime minister and critic of sanctions on Russia, currently leads the polls. In the meantime, the caretaker government cannot pursue reforms.