S&P Affirms Slovakia's A+ Rating, Downgrades Outlook to Negative

Bratislava/New York, April 26 (TASR) - The international agency Standard & Poor's (S&P) on Friday (April 25) affirmed Slovakia's A+ local currency sovereign credit rating, but downgraded its outlook from stable to negative, citing global developments as the main reason behind the downgrade. "The good news is that Slovakia has maintained its A+ rating, which is two notches higher than that of Fitch and Moody's. However, the uncertainty brought by the threat of global trade wars is worsening Slovakia's outlook from stable to negative," reacted the Slovak Finance Ministry. According to the ministry, S&P analysts in their report praised the government's significant fiscal consolidation efforts. They estimate that the deficit will decrease to 4.7 percent of GDP in 2025. This assumption is fully in line with the Finance Ministry's plan, which has also been defined in the state budget approved for this year. The agency also expects Slovakia's economy to grow by 1.6 percent in 2025 and by 1.3 percent in 2026. It expects investment financed from EU funds and the Recovery and Resilience Fund (RRF) to be the key driver of growth in 2025-2026. The agency in its rating also deals with potential risks to the Slovak economy posed by unpredictable developments in global trade. On the one hand, it is closely linked to Germany and, on the other hand, it is significantly affected by the export of cars and their components to the USA. "We have revised our outlook to negative, since Slovakia is highly export-oriented and the automotive industry is at risk of being affected by global trade tensions," the agency explained, adding that it perceives a high level of uncertainty regarding the implementation of tariffs by the US in the coming months. "I view maintaining the A+ rating in a situation where we inherited public finances from the previous government in the worst condition in the entire EU, as positive news. We expected the outlook to be revised from stable to negative, and the agency clearly stated the reasons. It is a consequence of risks posed by external factors at a global level, and not related to government actions," stated Finance Minister Ladislav Kamenicky (Smer-SD) in reaction to S&P's rating. ko