Investment Property in Slovakia

Politics

‘Velvet Revolution’

Slovakia was essentially formed when Czechoslovakia split into the nations of the Czech Republic and Slovakia on January 1, 1993. The ‘Velvet Revolution’ of 1989 (so called due to the lack of violence involved) led to the end of the rule of the Communist Party of Czechoslovakia and the formation of a new, non-communist government.

‘Velvet Divorce’

Three years on from the Velvet Revolution, Slovakia found herself with a miltary defence-orientated industry which was ill prepared for a new global market economy. This resulted in a rise in unemployment and economic hardship for Slovakia, whereas the Czech Republic was doing much better, mostly due to their economy being more geared towards privatization. These economic differences led to politicians in both republics pushing for the two republics to become two separate sovereign states. It was agreed to amicably disband Czechoslovakia (hence the ‘Velvet Divorce’).

Politics of independence

Vladimir Meciar was the figure behind the independence, a populist yet authoritarian prime minister whose politics are seen to have set Slovakia back in its earliest days as an independent republic.

Political and economic reform

In the 1998 elections Meciar was finally ousted, and the reform-minded Mikulas Dzurinda became prime minister. Under Dzurinda's leadership Slovakia was admitted to NATO and the European Union (in 2004); Slovakia will adopt the euro ahead of any of its Central European neighbours, in January 2009. Dzurinda’s economic reforms, including a flat-tax of 19%, energised the economy and led to an increase in foreign investment.

Current political structure

Slovakia of today is a parliamentary republic with the Head of State being the president of the republic. Ivan Gasparovic is the current president, who was elected in April 2004; the next presidential election is in 2009. The current prime minister of Slovakia is Robert Fico, of the Smer-Social Democracy (Smer-SD) party.

Fico’s government

In June 2006, with voters rejecting the Dzurinda government, a coalition led by Robert Fico was voted in. Mr Fico is the leader of Smer, a left-wing populist party that some say is committed to reversing economic reform. In a strange political twist, one of Smer's coalition partners is Vladimir Meciar’s new party.

Ethnic minorities

Dzurinda’s government had tried to improve the lot of ethnic minorities. While Fico is committed to strengthening welfare measures, his real position regarding minorities so far remains unclear. The ethnic minorities of Slovakia are an ongoing and sensitive political point. Slovakia's ethnic Hungarian community seeks greater educational and cultural autonomy and the country’s significant Romany population suffer disproportionately high levels of poverty and social deprivation. The expulsion of 3 million ethnic Germans and 600,000 ethnic Hungarians from post- war Czechoslovakia and the confiscation of their property (known as the ‘Benes’ decrees) remains a sensitive issue in the Slovakia of today.