Slovakia is winning the fight against inflation among the Visegrád Four (V4). While inflation is at 8% in Poland, 7.4% in Hungary, and 5.4% in the Czech Republic, Slovakia, despite not taking any measures, is at 5.1%.
Slovakia is the only country among the four with the euro as its currency. However, this is not a guarantee of stable price increases – a goal the European Central Bank has been neglecting. Now, being a member of a currency union means our hands are tied when dealing with the pandemic and the inflation compared to the other members of the V4.
Finance Minister Igor Matovič has, surprisingly, not announced a genius plan to combat the rising prices yet. It is mostly the opposition party Direction (Smer), who advocates for reducing the VAT rate. Analysts warn that populism may prove to be a more popular way out of the crisis than real, practical help.
Salary growth: Ivana Molnárová, the CEO of Profesia.sk, talks to TREND about the case for a salary increase in companies, why employees should try and negotiate better salaries, and what an adequate salary increase looks like.
Rising food prices: Slovak Agriculture and Food Chamber (SPPK) warns Slovaks will start to go grocery shopping in neighbouring countries, where inflation has forced the governments to keep the prices of food artificially low. Samuel Vlčan, the Minister of Agriculture and Rural Development, said that Slovakia may need to react to the rising food prices like its neighbours did and that lowering the VAT rate for certain staple foods is on the table.
The future of Slovak energy remains nuclear for now
The nuclear power station Mochovce is one step closer to opening the Unit 3 nuclear facility. The Nuclear Regulatory Authority (ÚJD) is calling for comments on the draft of the second-instance decision after giving first-instance approval.
Unit 3 and 4 have been under construction for 13 years now and the power plant still has not seen any profit from this investment. Making Unit 3 operational would mean significant profits, especially in light of the record electricity prices, which are now three times higher than the long-term average.
The Ministry of Environment does not consider natural gas to be the ultimate solution to the energy crisis as it is a fossil fuel. They would like to see the state support of fossil fuels increasingly reduced.
The Ministry said the country is dependent on nuclear energy and it will have to stay that way until renewable energy solutions become realistic. That is why they agree with the proposal of the European Commission to label nuclear power as green.
Heating prices: Adrián Fumač tells TREND how to lower your heating expenses and how to select a reliable and cost-effective heating system for your home.
Humenné: The residents of the town will pay 30% more for electricity in the new year. It was supposed to be 45%, but the council has agreed to lower the distribution price of the Humenné Energy Company (HES).
President Čaputová says the country needs to be ready for anything as the tensions between Russia and Ukraine rise
Prime Minister Eduard Heger called an emergency meeting of the Security Council on Tuesday to discuss the conflict between Russia and Ukraine. He called for solidarity and cooperation within the EU and emphasised his desire for a peaceful resolution.
President Zuzana Čaputová echoed the message but said the country should prepare for all possible scenarios by reviewing crisis management and state defence, as well as strengthening our support for Ukraine and the communication and cooperation with our partners.
Although the option of deploying NATO troops on the eastern border of the alliance hangs in the air, nothing has been confirmed yet. The spokeswoman of the Ministry of Defence, Martina Kovaľ Kakaščíková, said stationing foreign troops in Slovakia would have to be approved by relevant constitutional bodies.
Diplomats: While other countries are advising their citizens and diplomats to leave Ukraine, Foreign Minister Ivan Korčok said there is no need for it: “Quite the opposite, diplomatic presence is important and serves as a proof of our ability to reach a political decision”.
Omicron brings bleak economic forecast
The new COVID-19 variant seems to be spreading rapidly, already being dominant in the east of the country. The company Unilabs reports that Omicron presents 61% of the sequenced samples.
Data from countries where Omicron is the prevalent variant forecasts labour shortages, empty shelves, reduced opening hours, backlog in healthcare, and paralysed transport system.
Transport companies warn they will be raising their prices. If they have to deal with driver shortages, they will have to prioritise better paying customers, driving up the prices of transport and produced goods alike.
The National Health Information Centre (NCZI) said more than 1.4 million people have received their booster now. Bratislava region is leading the statistics, while Trenčín is on the bottom.
Prime Minister Eduard Heger said he might consider mandatory vaccination if the situation in hospitals becomes critical.
Other stories of the week
- Danish firm Eurowind Energy has announced plans to build a new wind farm near Šaľa with potential investment reaching tens of millions of euros.
- Read the TREND analysis of the top 10 investments announced in December and January, including solar farms, green gas, motorways, factories and more.
- Slovakia has potential in space research – we are sending nanosatellites into space and the GRBAlpha satellite is the first of its kind in the world to successfully detect gamma rays, which accompany the creation of black holes.
- And the same goes for Slovakia’s potential in AI – the Slovak pavilion at Expo 2020 presented the world’s first computer at the level of the human brain.
- Slovakia lags behind the rest of the EU in gender equality, states the recent Gender Equality Index. The country reached 56 out of 100 points, while the European average was 68.
- In the latest Corruption Perception Index from Transparency International, Slovakia jumped from 60th to 56th place.
- In a local economic paradox, Slovak companies on average spend more on salaries than Hungarian and Polish companies, yet Slovak salaries are still lower than theirs.