2002年-世界发展银行全球_Slovak_Republic___Development_Policy_Review_Volume_1_Summary_Report_43页_2mb

Slovak Republic Development Policy Review Summary

Core Content

This report presents a comprehensive analysis of the Slovak Republic's development policy, focusing on fiscal sustainability, trade integration, labor market reform, and governance improvements. It outlines both immediate and long-term policy actions necessary to align the country with EU accession standards and ensure macroeconomic stability.

Main Challenges and Objectives

• High fiscal and current account deficits (around 8% of GDP in 2002) pose a sustainability risk.
• Low employment rate (50% of working-age population) is a major concern, especially for low-skilled workers.
• The transition to EU membership provides a window of opportunity to address these issues in the next 1.5 years.
• Structural reforms are needed to improve competitiveness, reduce deficits, and promote growth.

Key Policy Recommendations

Immediate Actions (11-Point Agenda)

1. Reduce enterprise subsidies and guarantees (currently the highest among CEECs at ~6% of GDP), including:

   • Pruning non-CAP compliant agricultural support.
   • Sharply reducing transfers to railways.

2. Redirect existing expenditure programs to meet structural funds eligibility criteria, including:

   • Facilitating the development of a growth pole around Bratislava.

3. Increase retirement age to 65 to stabilize public pensions and avoid massive fiscal deficits due to demographic changes.

4. Postpone revenue reductions under the PEP until the expected expenditure cuts have been implemented.

5. Rebalance the tax burden away from payroll taxes toward other bases:

   • Streamline VAT refunds.
   • Tax windfall gas profits.
   • Align investment tax incentives with EU standards.
   • Subject all personal income (including child allowances) to personal income tax.

6. Increase electricity and natural gas tariffs to reflect market conditions, with lifeline blocks for low-income consumers.

7. Use privatization receipts to retire foreign debt, not domestic debt, to avoid stimulating domestic demand.

8. Start privatizing power generation (nuclear and thermal separately) and "unclaimed" land.

9. Reduce labor market rigidities:

   • Revisit the recently adopted labor code.
   • Reform the minimum wage system.
   • Decentralize collective bargaining.
   • Redesign Social Assistance benefits.

10. Debottleneck debt resolution procedures to enable a second round of ownership transfer for assets acquired under the Meciar government, and improve access to bank lending for SMEs.

11. Reduce internal trade barriers within the Czech-Slovak Customs Union ahead of EU accession.

Long-Term Reforms

Social Protection

• Shift from a pay-as-you-go (PAYGO) system to a fully funded second pillar.
• Gradually move toward a mandatory second pillar to improve pension replacement rates.
• Establish regulatory institutions to oversee pension and social security systems.
• Use EU access to integrated capital markets to support the reform.
• Address rising cash social assistance payments by adjusting benefit levels, reducing withdrawal rates with income, and improving activity tests.

Health Sector

• Contain excess demand through more narrowly defined benefits and greater cost sharing.
• Improve the efficiency and equity of the financing mechanism:
  • Merge health insurance companies.
  • Integrate collections with other social contributions.
  • Improve compliance and broaden the revenue base.
• Increase provider efficiency:
  • Better-designed payment mechanisms.
  • Rationalization of provider networks to reduce overstaffing and excess hospital beds.
  • Accountability mechanisms for quality and service delivery.
  • Develop management skills at the facility level.
• Ensure adequate public health support and equal access to health services, especially for the Roma population.

Education Sector

• Consolidate facilities and staff at primary and secondary levels, using a new funding mechanism based on capitation payments.
• Reorient secondary education to better meet labor market needs:
  • Increase general academic enrollments.
  • Enhance the academic content of vocational streams.
• Use cost savings from consolidation and reorientation to improve quality and fund gradual expansion at the tertiary level, alongside tuition payments.
• Establish stronger accountability mechanisms, such as:
  • National student assessments.
  • University accreditation systems.
• Ensure equal education opportunities for the Roma.

Macroeconomic Outlook and Welfare Impact

• The current growth rate is 4% for 2002, but fiscal deficits are expected to undermine future growth.
• The real exchange rate is distorting the labor market, particularly for low-skilled workers.
• Domestic demand is being fueled by greenfield investment and fiscal expansion, not by over-investment.
• The fiscal burden is not being offset by corresponding expenditure reductions, leading to unsustainable deficits.
• Without reform, the public debt-to-GDP ratio could exceed the Maastricht threshold of 60% by 2007.

Governance Reforms

• Transform budgeting frameworks into effective fiscal planning tools:
  • Improve financial and performance data quality.
  • Enhance system integrity.
  • Conduct periodic household budget surveys for policy design and analysis.
• Consolidate decentralization to ensure capacity and accountability before moving to the next phase.
• Reform the judiciary:
  • Professionalize court management.
  • Strengthen investigation and prosecution of corrupt judges.
  • Improve regulation bodies for legal professions to enhance client protection.

Key Data and Trends

• GDP growth has improved from 1.8% in 1999 to 4% in 2002.
• Unemployment remains high at 19.4% in 2001.
• Inflation has declined from 12% in 2000 to 7.3% in 2001.
• Fiscal deficit has increased from 4.3% in 1999 to 8.5% in 2001.
• Public debt is projected to reach 60% of GDP by 2007 under the no-reform scenario.
• Exchange rates have appreciated significantly, affecting competitiveness.
• Labor market rigidity is among the highest in CEECs, with low self-employment and part-time work rates.

Conclusion

The report emphasizes that the Slovak Republic's fiscal and trade imbalances are unsustainable and must be addressed through structural reforms and governance improvements. Immediate actions are necessary to stabilize public finances, reduce subsidies, and reform the labor market, while long-term efforts should focus on social protection, health, education, and judicial reform. These changes are critical to ensuring growth, employment, and long-term economic stability ahead of EU accession.