Finance Ministry: GDP growth expected at 1.9% this year and 0.6% in 2023

Despite the continuing COVID-19 pandemic, energy crisis and the conflict in Ukraine, Slovakia is still forecasted to see GDP growth of 1.9 percent this year and 0.6 percent in 2023, according to September's macroeconomic prognosis unveiled by Finance Ministry state secretary Marcel Klimek on Tuesday. In the face of the steep growth in energy prices, inflation is expected to soar to 12.4 percent and accelerate to 13.5 percent in the next year. "The macroeconomic prognosis, tax prognosis as well as the next development of Slovak public finances will be influenced and limited by the energy crisis in Europe," stated Klimek. Analysts of the Financial Policy Institute (IFP) have already included the planned state intervention into their estimates of the energy prices development, the growth of which is to be capped. Had the state not intervened, prices would have ratcheted up fourfold and inflation would have skyrocketed up to 30 percent. However, the adverse effect of high energy prices on industry has already manifested itself and will continue to do so also in early 2023. Nominal wages are supposed to increase by more than 10 percent in the public sector next year and a similar rise is expected by the analysts in the private sector. However, the growth of real wages is to equal zero. Employment is predicted to stagnate. (HNonline)