Bratislava, July 7 (TASR) – Foreign trade has confirmed positive trends in both domestic and foreign demand, UniCredit Bank Czech Republic and Slovakia analyst Lubomir Korsnak said on Friday.
He was speaking after it was reported earlier on Friday that Slovakia’s foreign trade balance came in at a surplus of €264.8 million in May 2017. This was a drop of €159.1 million compared to May 2016. Total exports rose by 4.1 percent year-on-year, having been outpaced by imports, which rose 7.3 percent.
After some swings around Easter, foreign trade went back to normal, especially in terms of turnover.
The falling surplus was due to stronger domestic demand, said Korsnak. However, prices have also had an effect, especially the recovery in crude oil prices in late 2016 and early this year, as oil has a greater effect on the prices of imports than on those of exports.
As expected, foreign trade turnover was quick to recover in May following weaker data in April. Both exports and imports experienced robust monthly and annual increases.
“We expect foreign trade surpluses to shrink in piecemeal fashion, especially in the latter half of this year. This fall in surpluses should only be short-lived, however, and will concern imports of technology, particularly in connection with major investments in the car-making industry. Once production launches in the second half of 2018 and in 2019, we expect the surpluses to grow faster again,” said Korsnak.
Slovenska Sporitelna bank analyst Katarina Muchova noted the higher pace of growth in imports and exports in May following the subdued performance in April, which she also partly blamed on Easter.
“The robust rise in imports has to do with a recovery in household consumption, as well as with imports related to several major investments,” she added.
Slovakia’s main trade partners continue to fare well and their outlooks remain good, which bodes well for Slovakia’s net foreign demand and, as a result, the country’s GDP growth.
“We expect the Slovak economy to grow by 3.1 percent of GDP this year,” said Muchova.