THE LEGATUM PROSPERITY INDEX™ 2016

Bringing Prosperity to Life

Slovakia

Ranked 36th of 149

At a glance

Ranks

36 th on the Legatum
Prosperity Index™

46th
49th
48th
30th
46th
23rd
43rd
86th
34th

SUB-INDEX RANKINGS

In the Prosperity Sub-Index rankings, Slovakia performs best on Safety & Security and Education and scores lowest on the Social Capital sub-index.

Visit our Rankings table to see how Slovakia compares to other countries.

Prosperity Gap

The ‘Prosperity Gap’ takes a country's GDP and uses it as the yardstick to measure a nation's expected Prosperity Index ranking.

Slovakia performs only slightly better than expected given its wealth. Its prosperity surplus has gradually decreased over the past decade due to poor performance in Economic Quality, Governance, and Social Capital. Poland and Estonia deliver considerably more prosperity than Slovakia with similar GDPs per capita.

Note:
In the chart above, each dot represents a country. The curve shows the general tendency with which prosperity increases as GDP per capita increases. If a country falls below the curve, then we can say that compared to all other countries, it is under-delivering prosperity for its citizens. Likewise, if a country rises above the curve, then we can say that it is over-delivering prosperity for its citizens. Learn more about the Prosperity Gap here.

Alternatively, have a look at the Prosperity Gap view on our Rankings table for a full list of countries and to see how each of them are performing on the various sub-indices.

Commentary

Slovakia experienced such rapid economic growth until the 2008 global financial crisis that it was nicknamed the “Tatra Tiger,” named after the Tatra mountain rage in the country. Slovakia recovered quickly following the crisis and has returned to growth. While the GDP growth rate is not as high as it was before the crisis, it is still one of the highest in the European Union. Despite this growth, Slovakia has moved down 11 ranks in the Economic Quality Index over the past decade. From 2008 – 2011, Slovakia had a particularly favourable trade environment, but now has a higher prevalence of trade barriers and less effective anti-monopoly policies than in 2007. Poverty and unemployment have also risen in the same period.

Although Slovakia has seen an overall improvement in the Business Environment sub-index, it has been overtaken by regional peers such as Poland and the Czech Republic. It has moved down 12 ranks to 49th in the past decade. Labour market flexibility has fallen, while electricity has not become considerably cheaper as it has in some of its neighbours. Nevertheless, it is an easy place to start as business and attracts a healthy amount of foreign direct investment because of its favourable corporate tax rates. It is important for Slovakia to invest further in Education and R&D to increase innovation and entrepreneurship.

Business Environment (score) in Slovakia, Poland and the Czech Republic
Poland and the Czech Republic overtake Slovakia in the Business Environment sub-index.

In the Governance sub-index, Slovakia has moved down seven ranks to 48th, having been eclipsed by Poland which moved up ten ranks from 46th to 36th. There are concerns over decreased transparency and, notably, judicial independence, which is the lowest in the EU.

Safety & Security is Slovakia’s best performing sub-index. It ranks 23rd, having moved up seven ranks since 2007. More people feel that they have enough money to provide adequate food and shelter than ten years ago, while 13% more people feel safer walking alone at night. Road deaths and homicides have also decreased. It performs above the OECD average in this sub-index.


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Data

How to read this graph:
When comparing multiple countries on a spider chart, data points that appear
further away from the center represent a better performance to the points that are closer to the center.