15:07 | 12/03/2019 Global Economy
Slovakia reported the worst economic freedom results in central Europe. The country ranked 65th place in the latest Economic Freedom Index, published by the Heritage Foundation. It scored only 65 points.
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As for the other countries in the region, the Czech Republic came 23rd, Austria 31st, and Poland 46th. Hungary stands the closest to Slovakia, ranking 64th.
"We have been the average and even below the average for a long time," said Ján Oravec, president of the Entrepreneurs Association of Slovakia (ZPS), as quoted by the TASR newswire. "Overregulation is a problem."
Hong Kong became the most economically free country in 2019. It has topped the index since 1995. Second came Singapore, followed by New Zealand and Switzerland.
"Slovakia is an excessively regulated country, and its business community struggles to not breach a law," said Matúš Pošvanc of the F. A. Hayek Foundation, as quoted by TASR.
The special 2.5-percent levy on retail chains, holiday vouchers, higher surcharges for night and weekend shifts, the ban on shops remaining open during holidays as well as the increase in minimum wage are just some of the measures that have a negative impact on doing business in Slovakia, said Martin Hošták, secretary of the National Union of Employers (RÚZ), as reported by the SITA newswire.
Although the Economy Ministry has adopted measures to help entrepreneurs, some of the laws in place overshadow the positive effects of adopted measures, Oravec claimed, as reported by TASR.
"From the RÚZ's perspective, the Slovak government does not consider the business environment and economic freedom their top priorities," added Hošták, as quoted by SITA.
However, the organisations uniting entrepreneurs and employers welcome the proposals, including a corporate tax of 15 percent as of 2020, which the Slovak National Party (SNS) recently presented.
"The government policy should go in this direction," said Oravec, as quoted by SITA. "We need a complex government policy to increase the competitiveness of the Slovak economy."
The government's insufficient austerity, high level of corruption, inflexible labour market and slow introduction of required reforms have caused Slovakia to score only 65 points while Hong Kong managed to achieve a score of 90.2 points.