DOCSLIB.ORG

Stability Programme of the Slovak Republic for 2018 to 2021

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Stability Programme of the Slovak Republic for 2018 to 2021 ; Stability Programme of the Slovak Republic for 2018 to 2021 April 2018 Ministry of Finance of the Slovak Republic TABLE OF CONTENTS TABLE OF CONTENTS .......................................................................................................................................... 2 SUMMARY .............................................................................................................................................................. 6 1. ECONOMIC OUTLOOK AND PROJECTIONS .............................................................................................. 8 1.1 External environment .......................................................................................................................... 8 1.2 Economic development in Slovakia in 2017 .................................................................................... 10 1.3 Economy development mid-term forecast ...................................................................................... 12 1.4 Cyclical development of the economy ............................................................................................. 15 1.5 Forecast comparison of the MoF SR and other institutions .......................................................... 17 2 PUBLIC FINANCE POSITION ...................................................................................................................... 18 2.1 General government balance in 2017 ............................................................................................... 19 2.2 Current development in 2018 ............................................................................................................ 22 2.3 Medium-term budgetary outlook for 2019 to 2021 .......................................................................... 23 2.4 Structural balance .............................................................................................................................. 24 2.5 Expenditure benchmark .................................................................................................................... 26 2.6 No-policy-change scenario ............................................................................................................... 27 2.7 The impact of fiscal policy on the economy in 2019 to 2021 ......................................................... 31 2.8 General government debt.................................................................................................................. 31 3 SENSITIVITY ANALYSES AND COMPARISON WITH THE PREVIOUS UPDATE ..................................... 36 3.1 Risk scenarios of development ........................................................................................................ 36 3.2 Comparison with previous update ................................................................................................... 38 4 PUBLIC FINANCE SUSTAINABILITY .......................................................................................................... 39 4.1 Assessment of the overall sustainability of public finance according to EC methodology ....... 39 4.2 Update of the projection of expenditure sensitive to aging and impact on long-term sustainability ................................................................................................................................................... 40 5 PUBLIC FINANCE QUALITY ........................................................................................................................ 43 5.1 Revenue objectives of the general government budget ................................................................. 43 5.2 Expenditure objectives of general government budget ................................................................. 46 5.3 Spending review ................................................................................................................................ 48 5.4 Better investment management ........................................................................................................ 51 6 INSTITUTIONAL ASPECTS OF PUBLIC FINANCE..................................................................................... 53 7 STRUCTURAL POLICIES ............................................................................................................................ 57 ANNEXES ............................................................................................................................................................. 59 2 Ministry of Finance of the Slovak Republic LIST OF BOXES, TABLES AND FIGURES BOX 1 - Update of the impact of new investments in the automotive industry on the Slovak economy ................ 14 BOX 2 - Methodological differences in the calculation of the potential product by MoF SR and EC ..................... 16 BOX 3 - Evaluation of tax revenue for the year 2017 (a forecast by the Tax Revenue Forecast Committee) ....... 20 BOX 4 - Fiscal stance ............................................................................................................................................ 25 BOX 5 - Additional tax changes ............................................................................................................................. 29 BOX 6 - One-off and temporary expenditure in 2018 ............................................................................................ 30 BOX 7 - Stochastic forecast of gross general government debt ............................................................................ 32 BOX 8 - Stock-flow adjustment .............................................................................................................................. 33 BOX 9 - Updating the projection of pension expenditure by 2070 ......................................................................... 41 BOX 10 - Methodology for calculation of tax gaps on VAT and CIT ...................................................................... 45 BOX 11 - Investment assessment - case study of the Northern Bypass of Prešov ............................................... 52 BOX 12 - Testing of expenditure ceilings in the general government budget ........................................................ 55 BOX 13 - Organization of Expenditure Review ...................................................................................................... 56 TABLE 1 - External assumption for the current forecast ( %) .................................................................................. 8 TABLE 2 - Forecast of selected indicators of the Slovak economy for 2018 to 2021 ............................................ 12 TABLE 3 - Assumptions of the investment plan and production of JLR ................................................................ 14 TABLE 4 - Assumptions of investment and new production of VW ....................................................................... 15 TABLE 5 - Contributions of JLR and VW to growth ............................................................................................... 15 TABLE 6 - Contribution of production factors to potential growth (pp) – MoF SR approach.................................. 16 TABLE 7 - Output gap - MoF SR approach ........................................................................................................... 16 TABLE 8 - Output gap (% of GDP) ........................................................................................................................ 16 TABLE 9 - Comparisons of forecasts of MFSR and other institutions ................................................................... 17 TABLE 10 - Change of fiscal targets (headline deficits) of public sector (% GDP) ................................................ 24 TABLE 11 - Consolidation effort (ESA2010, % GDP) ............................................................................................ 24 TABLE 12 - Structural primary balance - EC methodology (% of GDP) ................................................................ 25 TABLE 13 - Expenditure benchmark (ESA 2010) .................................................................................................. 27 TABLE 14 - Overall consolidation need to achieve the fiscal targets compared to NPC (ESA2010, % of GDP) .. 28 TABLE 15 - List of measures in the fiscal framework for 2018 to 2020 (ESA 2010, compared to NPC, impact on the balance) ........................................................................................................................................................... 28 TABLE 16 - Legislation changes not included in No-Policy-Scenario (% of GDP) ................................................ 29 TABLE 17 - The list of one-off measures in 2017 for the needs of NPC (ESA 2010, EUR mil.) ............................ 30 TABLE 18 - No-policy-change scenario and general government balance (ESA2010, % of GDP) ....................... 30 TABLE 19 - Stock-flow adjustment (% of GDP) ..................................................................................................... 34 TABLE 20 - Contributions to gross debt (mil. eur) ................................................................................................. 34 TABLE 21 - Scenario 1: Slowdown of foreign demand growth by 1 p.p. in years 2018-2021............................... 37 TABLE 22 - Scenario 2: Increase in short-term and long-term interest rates by 1 p.p. in the entire forecast ........ 37 TABLE 23 - Scenario 3: Faster
Load more

Recommended publications
  • Performance of the Slovak Economy in Relation to Labor Productivity and Employment
    Available online at www.sciencedirect.com ScienceDirect Procedia Economics and Finance 23 ( 2015 ) 970 – 975 2nd GLOBAL CONFERENCE on BUSINESS, ECONOMICS, MANAGEMENT and TOURISM, 30-31 October 2014, Prague, Czech Republic Performance of The Slovak Economy in Relation to Labor Productivity and Employment Rastislav Kotulica*,Ivana KravcakovaVozarovaa, Jozef Nagya, Emilia Huttmanovaa, a Roman Vavrek aUniversity of Presov in Presov, Faculty of Management, 17. novembra 1, 080 01 Presov, Slovakia Abstract The regions which are located in the European environment have different primary sources, their quality and their level of utilization, which has a direct impact on their performance and subsequent productivity. The aim of this paper is to evaluate the performance and productivity of the Slovak economy in relation to employment in the period from 1995 to 2012. We assume that between employment and performance of the Slovak economy in individual periods is a strong dependence. This analysis confirmed our assumption. The productivity growth of the Slovak economy is directly proportional related to the ability of enterprises to respond successfully to new challenges in the field of innovation and the optimal use of productive resources. The correct interpretation of the results of performance and employment in the national economy can greatly help to clarify the situation on the labor market and thus to diagnose conditions that influence to a greater extent the behaviour of people of working age. © 20152014 TheThe Authors. Authors. Published Published by by Elsevier Elsevier B.V. B.V. This is an open access article under the CC BY-NC-ND license (Selectionhttp://creativecommons.org/licenses/by-nc-nd/4.0/ and/ peer-review under responsibility of).
    [Show full text]
  • Impact of Foreign Direct Investment on the Economy of Slovakia
    NATIONAL BANK OF SLOVAKIA Adela Hošková IMPACT OF FOREIGN DIRECT INVESTMENT ON THE ECONOMY OF SLOVAKIA National Bank of Slovakia Institute of Monetary and Financial Studies Bratislava 2001 IMPACT OF FOREIGN DIRECT INVESTMENT ON THE ECONOMY OF SLOVAKIA © National Bank of Slovakia, Institute of Monetary and Financial Studies Adela Hošková. Bratislava 2001 2 Table of Contents Page INTRODUCTION 4 1. Foreign Direct Investment (FDI) in Slovakia 8 1.1 Inflow of Foreign Direct Investment 8 1.2 Outflow of Foreign Direct Investment 12 2. Impact on Balance of Trade and Payments 14 3. Regional Aspects of FDI in Slovakia 17 4. Impact of FDI on Employment, Labour Productivity and Know-How 27 5. Partnership Between FDI and Domestic Industry 36 CONCLUSION 44 REFERENCES 47 3 IMPACT OF FOREIGN DIRECT INVESTMENT ON THE ECONOMY OF SLOVAKIA According to the latest results, the inflow of foreign direct investment (FDI) to Slovakia has started to gain importance. It is therefore important to understand the impact of FDI on the economy of Slovakia, primarily on the real sector, banking, third sector, etc. This study aims to depict the impact of FDI on selected production areas, i.e. employment, labour productivity, know-how, partnership between FDI and domestic industry, and regional distribution of FDI. The final positives (and/or negatives) boil down to the impact on the balance of trade and payments of the SR, as a result of the capitalisation of pro-export oriented organisations, which sell their output (because of the small size of the Slovak market) in foreign countries, by means of FDI.
    [Show full text]
  • Income Distribution and Economic Growth; Empirical Results for Slovakia
    INCOME DISTRIBUTION AND ECONOMIC GROWTH; EMPIRICAL RESULTS FOR SLOVAKIA JURAJ ZEMAN WORKING PAPER 1/2018 © National Bank of Slovakia www.nbs.sk Imricha Karvaša 1 813 25 Bratislava [email protected] February 2018 ISSN 1337-5830 The views expressed in this paper do not necessarily reflect the views of the National Bank of Slovakia or the Eurosystem. All rights reserved. 2 Income distribution and economic growth; empirical results for Slovakia NBS Working Paper Juraj Zeman1 Abstract The relationship between income inequality and economic growth is an ambiguous one but most mainstream economists view real wage increases as a drag on economic growth as they lead to higher labor costs, lower competitiveness and reduction of employment. In this study we provide an alternative view and show that a labor income increase2 may also have a positive effect on growth. Which of these two effects dominates in a particular country depends on the institutional and legal environment of that country, its macroeconomic conditions and also its economic policies. We apply a general Keynesian growth model that combines demand and productivity regimes to test empirically two distinct economies – the small, very open economy of Slovakia and the large, relatively closed economy of the euro area3. We find that an income rise increases domestic demand and reduces external trade in both economies. But the total effect of income inequality on economic activity is opposite in both economies in the short run. In the Slovak case the positive effect of lower income inequality on domestic demand is surpassed by its negative effect on net exports.
    [Show full text]
  • Can Foreign Direct Investment Promote Exports in Slovakia?
    digitales archiv ZBW – Leibniz-Informationszentrum Wirtschaft ZBW – Leibniz Information Centre for Economics Li, Zheng-Zheng Article Can foreign direct investment promote exports in Slovakia? Provided in Cooperation with: Slovak Academy of Sciences, Bratislava This Version is available at: http://hdl.handle.net/11159/3971 Kontakt/Contact ZBW – Leibniz-Informationszentrum Wirtschaft/Leibniz Information Centre for Economics Düsternbrooker Weg 120 24105 Kiel (Germany) E-Mail: [email protected] https://www.zbw.eu/econis-archiv/ Standard-Nutzungsbedingungen: Terms of use: Dieses Dokument darf zu eigenen wissenschaftlichen Zwecken This document may be saved and copied for your personal und zum Privatgebrauch gespeichert und kopiert werden. Sie and scholarly purposes. You are not to copy it for public or dürfen dieses Dokument nicht für öffentliche oder kommerzielle commercial purposes, to exhibit the document in public, to Zwecke vervielfältigen, öffentlich ausstellen, aufführen, vertreiben perform, distribute or otherwise use the document in public. If oder anderweitig nutzen. Sofern für das Dokument eine Open- the document is made available under a Creative Commons Content-Lizenz verwendet wurde, so gelten abweichend von diesen Licence you may exercise further usage rights as specified in Nutzungsbedingungen die in der Lizenz gewährten Nutzungsrechte. the licence. Leibniz-Informationszentrum Wirtschaft zbw Leibniz Information Centre for Economics Ekonomický časopis, 67 , 2019, č. 2, s. 135 – 156 135 Can Foreign Direct Investment Promote Exports in Slovakia? Zheng-Zheng LI * – Chi-Wei SU ** – Ran TAO *** – Oana-Ramona LOBON Ţ**** Abstract In this paper, we investigate whether the knowledge capital model (Carr Markusen and Maskus, 2001) is satisfied in Slovakia by applying the bootstrap rolling window subsample test to examine the causal relationship between fore- ign direct investment (FDI) and exports (EX).
    [Show full text]
  • Economic Effects in Slovakia Within Integration in the European Union
    The International Scientific Conference INPROFORUM 2014 November 6 - 7, 2014, České Budějovice, 34-42, online ISSN 2336-6788, ISBN 978-80-7394-484-1. ________________________________________________________________________________________________________________________________________________________________________________________________ Economic Effects in Slovakia within Integration in the European Union Amir Imeri, Zuzana Bajusová1 Abstract: The wide interest, application and membership of Slovakia in European Union enable to study the economic effects in general terms. In our study we are going to analyze the economic cooperation of Slovakia before and after membership in EU. We will discuss whether economic cooperation between Slovakia and EU members increased or decreased after EU membership. This article provides a comprehensive and contemporary comparative analysis of the economic performance, the economic structure and the trade relations between Slovakia and EU countries, allow- ing us to detect basic trends and developments. We will compare the economic performance of Slovakia and other EU members (including Czech Republic and Slovenia), looking at aggregate figures from integration in EU such as foreign trade, FDI, GDP and its structure, level of structural unemployment and employment, inflation and level of income. Key words: EU Membership · Foreign Trade · FDI · GDP · Unemployment · Inflation JEL Classification: F4 · F14 1 Introduction The idea of peace and stability of a united Europe was the dream of philosophers and visionaries. On the ruins of World War II grows into the forefront the effort to create a new structure of Western Europe, based on common interests, based on treaties guaranteeing the rule of law and equality between all countries. Basis for the future unification of Europe was laid on 9th of May 1950 by French Minister of Foreign Affairs Robert Schuman and economist Jean Monnet.
    [Show full text]
  • Investment in Slovakia
    1 This document elaborates the most needful information needed for investors who want to know about investment and residence in Slovak Republic (EU, Schengen and currency Euro) it takes you through the opportunities, process and even the paperwork needs. Furthermore, it provides necessary information for future Slovak resident. CONTENTS 1) The Slovak Republic 1.1 History 1.2 European Union 1.3 Eurozone 1.4 Geography 1.5 Political system 2) Economy 3) Why Slovakia? 3.1 Top 10 reasons why to invest in Slovakia 4) Location & transportation 4.1 Transportation 4.2 Bilateral relations with bordering countries 5) Living standards 5.1 Costs of living & salaries 5.2 Taxes 6) Investment examples & incentives 7.1 Examples 7.2 Incentives 8) Registration of company 9) Registration of entrepreneur 10) Payments overview 11) Business Exploration Trip 12) Why Mindset International? 13) Contact us 2 THE SLOVAK REPUBLIC The Slovak Republic or, in a short form, Slovakia i/sloʊˈvɑːkiə/, in Slovak language: Slovensko is a sovereign state in Central Europe. It has a population of over five million and an area of about 49,000 square kilometers. Slovakia is a member state of the European Union, Eurozone, Schengen Area, NATO, The United Nations, the OECD and the WTO, among others. The official language is Slovak, a member of the Slavic language family. Please visit the Slovak Spectator for additional actual information about Slovakia from the point of view of foreigners living here. HISTORY Slovakia, as we know it, can be considered a very young country formed as an individual state in 1993 when separated from Czechoslovakia.
    [Show full text]
  • Through Knowledge Towards Prosperity Research and Innovation
    RIS3 SK Through knowledge towards prosperity Research and Innovation Strategy for Smart Specialisation of the Slovak Republic 13 November 2013 1 RIS3 SK Table of contents 1 INTRODUCTION 4 2 ANALYSIS 7 2.1 ANALYSIS OF SELECTED FACTORS OF THE SLOVAK ECONOMY 7 2.1.1 Sources of economic growth and nature of competitive advantage 7 2.2 Trends in export specialisation 8 2.2.1 Basic trends in development of the Slovak export 8 2.2.2 Technological complexity of sectors 10 2.2.3 Potential of Slovakia in raw materials 11 2.2.4 Position of the most important sectors in the Slovak economy 12 2.2.5 Linking the priority sectors to research and knowledge intensive services 13 2.3 Innovation environment in Slovakia 13 2.3.1 Evaluation of innovation performance 14 2.3.2 Funding of research and innovations 16 2.3.3 Tools of funding of research and development 17 2.3.4 Management of innovation process till 2013 19 2.4 Business sector and innovations 21 2.4.1 Small and medium enterprises 21 2.4.2 SMEs versus large companies 23 2.4.3 Status of clusters in Slovakia 24 2.4.4 Barriers to innovation activities in innovative enterprises 25 2.4.5 Venture capital 27 2.4.6 Incubators 28 2.5 Research and development potential of the Slovak Republic 28 2.5.1 Slovak Academy of Sciences 29 2.5.2 Universities 29 2.5.3 Sectoral research organizations 31 2.5.4 Scientific performance of research institutions 32 2.5.5 Participation of the Slovak Republic in the European research area 32 2.5.6.
    [Show full text]
  • THAPAR UNIVERSITY PATIALA June, 2017
    RENAISSANCE: ECONOMIC REVIVAL OF CENTRAL AND EAST EUROPEAN NATIONS A Thesis submitted In the partial fulfillment of the requirement for the degree of MASTER OF ARTS IN ECONOMICS (INTERNATIONAL BUSINESS) Submitted by: Anisha Kakria (861501002) UNDER THE SUPERVISION OF: Dr. Ravi Kiran Professor and Former Head School of Humanities & Social Sciences Prof. In Charge Alumni Relations Thapar University, Patiala THAPAR UNIVERSITY PATIALA June, 2017 ACKNOWLEDGEMENT It is pleasure to give my regards to all in my humble acknowledgment. First and foremost, I wish to express my gratitude to Dr (Ms) Ravi Kiran for her generous advice, inspiring guidance and encouragement throughout my research work. Her willingness to motivate me contributed tremendously to my work. This thesis could not have been completed without her generous and professional assistance. I would also like to thank Dr A.N Sah for his constant support and advice. My thanks and appreciation also goes to my friend Karampreet Kaur who have willingly helped me out with her abilities. Last but not the least, I would like to thank my parents B.K. Kakria and Sunita Kakria and my brother Shiraz Kakria for supporting me piously all through my life. iii TABLE OF CONTENTS Page no. Abstract CHAPTER 1 Introduction 1 1.1 Economies 2 CHAPTER 2 Literature review 6 CHAPTER 3 Research Design and Methodology 9 3.1 Objectives of the Research 9 3.2 Variables in the study 9 3.3 Research Design and methods 10 CHAPTER 4 Data analysis and interpretation 12 4.1 Performance of Hungary 12 4.2 Hungary: Regression
    [Show full text]
  • Untrusted Political Elites and Citizens: Is It a Contradiction of the Transformation Period Or...? (Ukrainian Case) 5 TETYANA BASINA
    Collection of Papers from the 1st PhD Students´ International Conference “my-PhD” Bratislava, Slovak republic April 13.-14. 2007 Conference was organized under the auspices of Mrs. Brigita Schmögnerová, Viceprezident of the European Bank for Reconstruction and Developement, President of Proforum – Progressive Forum No proof reading has been made in this publication. The only changes carried out are in the layout and quotation form of the contributions. Editors: Martin Muránky Jozef Kovalčik Copyright © 2007 Friedrich Ebert Stiftung e. V., Slovakia and contributors of the Collection of Papers from the 1st PhD Students´ International Conference “my-PhD” Friedrich Ebert Stiftung e. V. Maróthyho 6 811 06 Bratislava, Slovak republic Tel. 00421/2/5441 1209 Fax: 00421/2/5441 1641 www.fes.sk ISBN 978 - 80 - 89149 - 12 - 4 EAN 9788089149124 2 Content Untrusted Political Elites and Citizens: is it a contradiction of the transformation period or...? (Ukrainian case) 5 TETYANA BASINA Energy crisis and its impact on policies in the new EU Member States 11 JAROSLAV BIEHUNEK The idea of social justice: the problems and perspectives in globalised Europe 25 ĽUBOŠ BLAHA Specifics of European market - Approach of Intercultural Psychology 35 MONIKA BODOROVÁ Understanding Participation and Action Research: Action Research Methodology as a Tool for Involvement of Stakeholders in Social Research 43 PETER BRONIŠ Happiness and Optimism: the attitudes of post-communist nations of Central Europe 54 RODRIGO BUGUEÑO DROGUETT Social Costs of Structural Changes: Symbolic
    [Show full text]
  • International Outsourcing Over the Business Cycle: Some Intuition for Germany, the Czech Republic and Slovakia
    EASTERN JOURNAL OF EUROPEAN STUDIES Volume 1, Issue 2, December 2010 165 International outsourcing over the business cycle: some intuition for Germany, the Czech Republic and Slovakia Sandrine LEVASSEUR* Abstract In this paper, we assess the extent to which multinational firms – in the first instance, the German ones – may adjust their international outsourcing over the business cycle in the Czech Republic and Slovakia. For that purpose, we have used monthly data of production for the manufacturing sector as a whole and some of its sub-sectors, since 2000 onwards. Our econometrical estimates suggest that there would be an asymmetry in the international outsourcing across the states of the economy, meaning that multinationals firms would be engaged differently in outsourcing activities, depending on whether bad or good economic times occur. Yet, such an asymmetry is found increasing over the time for German and French multinationals operating in the transport equipment sector of Slovakia. Another conclusion is that international outsourcing made by multinational firms in Slovakia may account for a portion of its large business cycles volatility. Key words: international outsourcing, foreign direct investment, business cycles, Central and Eastern European countries, European integration JEL Classification: F21, F23, F44, F15 1. Introduction The countries of the European Union (EU) have been unevenly affected by the economic crisis which began in September 2008 with the collapse of *Sandrine Levasseur is senior economist at the OFCE – Center for Economic Research – Sciences; e-mail: [email protected]. The author would like to thank Jérôme Creel from OFCE and an anonymous referee for their valuable comments and suggestions on a previous version of this article.
    [Show full text]
  • Economic Development of Slovakia at the Background of the Economic Integration and Disintegration Process of Central Europe in 1867–1945
    196 L’. haLLon: economic development of slovakia at the background of the economic … Ľudovít hallon economic development of slovakia at the background of the economic integration and disintegration process of central europe in 1867–1945 udk 330.3(437.6)»18/19« udc 330.3(437.6)»18/19« HALLON Ľudovít, Phd, CSc., historický HALLON Ľudovít, Phd, CSc., historický ústav SAV/institute of historical studies SAS, ústav SAV/institute of historical studies SAS, klemensova 19, 813 64 Bratislava klemensova 19, 813 64 Bratislava Gospodarski razvoj Slovaške v luči srednje- Economic development of Slovakia at the evropske gospodarske integracije in dezin- background of the economic integration and tegracije v obdobju med 1867 in 1945 disintegration process of central Europe Zgodovinski časopis, Ljubljana 63/2009 (139), in 1867–1945 št. 1-2, str. 196–213, cit. 34 Zgodovinski časopis (Historical Review), 1.01 izvirni znanstveni članek: jezik en. (sn., Ljubljana 63/2009 (139), no. 1-2, pp. 196–213, en., sn.) 34 notes ključne besede: slovaška, gospodarski razvoj, Language: en. (sn., en., sn.) gospodarska integracija, gospodarska dezin- key words: slovakia, economic development, tegracija economic integration, economic disintegra- Prispevek predstavlja pregled slovaške gospo- tion darske zgodovine v obdobju od nastanka avstro- in article is given an overview on slovak ogrske monarhije do konca druge svetovne voj- eco nomic history from the establishment of ne. slovaški gospodarski razvoj je predstavljen austro-hungary up to the end WW II. the v treh časovnih enotah: habsburška monarhija presentation of slovak economic development oziroma ogrska nadvlada, češkoslovaška re pub- is structured in three periods: the habsburg mo- lika med obema vojnama in neodvisna država narchy or the period of hungarian dominance, slovaška med drugo svetovno vojno.
    [Show full text]
  • An Introduction to an Econometric Model of the Slovak Republic
    Financial Policy Institute Ministry of Finance of the Slovak Republic An Econometric Model of the Slovak Republic Scott Livermore* FINAL DRAFT May 2004 * Advisor to the Ministry of Finance of the Slovak Republic and hired as part of the World Bank Public Finance Management Reform project. The author can be contacted on [email protected] and [email protected] for further information. Abstract This report presents of theoretically consistent quarterly econometric model of the Slovak Republic. The model was developed under the scope of the World Bank’s Public Finance Management Reform project and is designed to assist analysts at the Ministry of Finance to produce forecasts for both the short- and long-term outlook for the Slovak economy in a consistent framework, analyse risks to the economic outlook and implications for the budget, and conduct policy simulation analysis. The structure of the econometric model of Slovakia is based on the income-expenditure accounting framework with an explicit treatment of the supply-side and a number of simulation results are presented to illustrate the properties, as well as some of the capabilities, of the model. The model report also contains a description of the supply side and the main equations in the demand, the wages and prices, the monetary and financial, and the fiscal blocs of the model. The developed model is now employed in the Financial Policy Institute of the Ministry of Finance of the Slovak Republic as a crucial component of the unit’s suite of tools for economic analysis. Table of contents Abstract 1) Introduction 1 2) Model outline 4 2.1.
    [Show full text]