The conflict in Ukraine is taking on real contours, and it will have negative effects on Slovakia as well. In terms of Slovak foreign trade, neither Russia nor Ukraine account for a significant share of its overall performance, but the structure is important. Slovakia imports two-thirds of its oil and related products from Russia and, in the case of gas, the Russian share of imports exceeded 90% in 2020. A possible halt in economic cooperation could thus cause problems for Slovakia in the supply of gas, oil or nuclear fuel. Matej Horňák, an analyst at Slovenská sporiteľna, warned that even possible aid in the form of liquefied gas would not be enough for Europe.
"The needs of the old continent would be far from being fully met. The current energy crisis would thus deepen even further and companies, together with consumers, would face further problems as the price of energy would rise again," Horňák believes.
In addition to gas shortages, Horňák also highlighted other economic dimensions of the conflict between Ukraine and the Russian Federation. The most important dimension, according to him, is the political one, which in the event of the destabilisation of Eastern Europe would have an impact, for example, on the decision-making of foreign investors.
The conflict will also have an impact on Slovakia through supply networks and the interconnectedness of companies.
"It is also possible that a possible military conflict in Ukraine would also put more pressure on public finances, not only through higher defence costs (e.g. stronger border protection), but also through spending on humanitarian purposes, when a large number of asylum seekers could enter Slovak territory," the analyst added.
Last but not least, in his opinion, there will be more intense debates on Europe's energy self-sufficiency. "Whatever the outcome of this conflict, the European Union will work much harder to secure alternative energy supplies and find ways to achieve this, even in the longer term. Thus, the processes of transition to green technologies will accelerate significantly," the analyst concluded.
Source: TASR
