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Making the Most of Public Investment in the Eastern Slovak Republic

image of Making the Most of Public Investment in the Eastern Slovak Republic

The Slovak Republic joined the European Union in 2004, the Schengen area in 2007 and the euro in 2009. These events, coupled with decentralisation reform and the creation of administrative regions, have brought significant change. While overall growth has been impressive compared to OECD countries overall, benefits have not accrued equally across the country. Public investment could potentially improve regional conditions and attract private funding, but governance bottlenecks stand in the way. This case study shows that the main obstacles to effective public investment are linked to high local fragmentation as well as the challenges national and subnational administrations face in designing and implementing investment strategies that correspond to local needs. Drawing on a detailed set of indicators, the study provides recommendations to address these challenges and make the most of public investment in the Slovak Republic.

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Economic growth and regional well-being in the Eastern Slovak Republic

The Slovak Republic has experienced notable economic growth since entering into negotiations to join the European Union in 2000. Between 2004 and 2008, gross domestic product grew at an average annual rate of approximately 7%, dropping off in the face of the global financial crisis but rebounding to 2.5% in 2010-13. While (on average) residents have become better off over time, and growth has been impressive compared to OECD countries overall, benefits have not accrued equally everywhere. The western regions of the Slovak Republic and Bratislava in particular, have achieved gains that substantially outpaced those in the east. The Eastern Slovak Republic’s economy has long been the weakest in country. Východné Slovensko lags behind not only other regions within the Slovak Republic but also well behind EU and OECD regions overall. Looking at the OECD measures of regional well-being, the Eastern Slovak Republic presents broad challenges at the regional level linked to infrastructure and investment.

English

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