Running a business in Slovakia
Are you concerned with a variety of issues related to running a business in Slovakia? Our members and partners provide a comprehensive support and services to deal with all issues related to doing your business in Slovakia.
- Comprehensive structural reforms of the tax, labour, pensions and healthcare systems and an overall decentralization of powers in past years.
- Membership in the Eurozone since 2009.
- One of the strongest recoveries in terms of GDP growth in the regions after the 2008 crisis.
- Higher levels of unemployment as compared to the situation in the Eurozone which indicates a potential for growth without the upward pressure on wages.
Ease of doing business
Based on the World Bank report on the ease of business, in 2018, Slovakia ranked number 39 in the world. In terms of comparable countries in the region, this year it was only surpassed by Poland. Slovakia was the regional leader in the ranking in years 2008 to 2013. The factors considered by the World Bank as measures of the index include:
- the political and institutional environment,
- macroeconomic stability, market potential,
- private entrepreneurship support,
- taxation system,
- access to financing, contract enforcement,
- the starting and closing of a business,
- labour market characteristics, and
- infrastructure quality.
DID YOU KNOW?
Slovakia and the CEE region offer foreign companies a number of advantages. Development of business relationships within the European Union are easy due the close geographical proximity, with good access through a number of budget airlines, meaning business here is especially ideal for SMEs on tight budgets. The European Union funded infrastructure, energy, and innovation projects have also created opportunities, and it currently has a far lower market penetration in comparison with West European markets. The Slovak workforce is highly skilled. The main foreign languages spoken are English and German. Hourly labour costs in Slovakia are more than 3 times lower than in Germany.
- Tradition of electrical and chemical engineering, wood-processing and food industry.
- Industry is currently undergoing a phase of rapid growth, which is attributable to the favourable business environment and a supply of foreign investors.
- Slovakia is one of the world leaders in the automotive industry with four well-known car manufacturers. PSA Peugeot Citroën (in Trnava), KIA Motors & Hyundai Mobis (in Žilina), Volkswagen (in Bratislava) and Jaguar Land Rover (in Nitra) produce their cars in our country.
-In 2015, the Slovak automotive industry reached production levels of more than a million cars per year.
-Slovakia maintains the position of a world leader in the indicator of car production per capita.
- Electrical engineering is now the second largest industry as well as the second largest employer.
-LCD panels are a key product and they are produced by companies such as Samsung, Foxconn, AU Optronics or UMC.
Recent attractive sectors
- Strong interest of international companies in relocating and centralising their business services to the region of Central and Eastern Europe (CEE) with shared services sector becoming one of the key sectors in Slovakia, employing more than 30,000 people.
- Bratislava stands as an important IT cluster in the CEE region, being home to internationally recognised IT companies such as ESET and Sygic.
- Bratislava also provides vital conditions for numerous local start-ups with many of them rising to international prominence (sli.do for instance).
DID YOU KNOW?
In the Slovak Republic money payed as registered capital can be immediately used for the company’s needs and does not have to be kept in the company.
HUMAN CAPITAL
- A qualified and relatively inexpensive labour force is Slovakia’s greatest asset.
- The gross minimum wage is stipulated by the law, and translates to €2.8 per hour worked.
- The social security contributions by the employer amount to 35.2% with a cap for social contributions at a maximum base of €6,181.
- Slovakia is the regional leader (among V4 countries) in terms of labour productivity per hour worked.
Education
- In order to receive a high school diploma (so-called Maturita), there is a mandatory foreign language exam on the internationally recognised level B2.