Macroeconomic Forecast Slovakia

Slovak industrial output growth continues to slow, coming in at 13.9% y-o-y in January-August. We expect this trend to continue through the final four months of 2007, with the full-year figure forecast at 12.0%. Base effects will be a major factor weighing on industrial output growth, especially in the fourth quarter as the growth effects of two major automobile production plants, which opened at the tail-end of 2006, wear off. That said, we are still forecasting industrial output to remain relatively robust going forward, averaging an annual expansion of 7.3% until 2011. While we expect greenfield investment in new manufacturing facilities to contract steadily over the long term, new factories should remain a major source of industrial growth at least in the medium term.

To read the full article, please choose one of the following options: