According to Kinstellar Bratislava Partner Viliam Mysicka, the Covid pandemic has posed a significant challenge for Slovakia's government. “The government was formed just before the March 2020 lockdown happened, and the majority of the ministers are new,” he says. “They have more experience as CEOs than as politicians.”
In addition to the government’s relative inexperience, Mycicka describes a running disagreement between Prime Minister Igor Matovic and Richard Sulik, the Minister of Economy, on certain Covid-related measures. Mysicka describes Sulik as a strong individual who served as Minister of Economy ten years ago. “He is forming a sort of opposition within the government,” he says. “He is very vocal about his stances, and sometimes his dispute with the prime minister spills over to social media.”
Despite the conflict in the government, Slovakia’s executive authority seems to be steadfast in its fight against corruption, according to Mysicka. “The leading party of the government won the election with the pitch to the public that they will fight corruption — and they are really trying to deliver on that promise,” he says, adding that “many politicians, judges, and other influential people have been taken into custody and interrogated about their potentially illegal activities, and many are being prosecuted.” He reports being generally encouraged by this initiative, but he warns that certain practices of the Slovak police in recent months are being criticized as unbalanced. For example, he says, the Slovak Bar Association has recently expressed its concerns that the principle that lawyers cannot be prosecuted for providing legal advice is being disregarded in certain cases.
The Slovak economy has, in any event, several challenges to overcome, as the country has already suffered greatly due to the pandemic. “Slovakia’s economy is dependent on the automotive sector,” Mysicka explains. “Peugeot, Land Rover, KIA, and Volkswagen have manufacturing plants here and generate between 10-50% of the Slovak economy.” Thus, he says, “we have an export-driven economy, and since the sale of automobiles has decreased significantly in some countries, we will probably have a 5-10% drop in GDP this year.”
Other industries, such as real estate, banking, and energy, remain healthy, Mysicka reports. “One of the biggest transactions in the energy sector was E.ON’s acquisition of Vychodoslovenska Energetika Holding from RWE,” he says (referring to the deal reported by CEE Legal Matters on September 22, 2020).
New economic opportunities may arise in the future, Mysicka explains, with the arrival of the 5G network in the country. According to Mysicka, a draft law on the network was recently introduced in parliament and is expected to pass soon. “Slovakia will have to choose between two Scandinavian and two Chinese network providers," he says, "but based on the public comments of several politicians, Slovakia will most likely choose one of the Scandinavians."