Irresponsible government and parliament pushed risk of default to 18%

Budget decisions taken in 2022 and in the first half of this year have increased Slovakia's probability of defaulting on long-term liabilities (bankruptcy) to 18% from 6% at the end of 2021, estimates the fiscal responsibility council RRZ. These were mainly increases in social benefits (family package) and pensions. Slovakia will face the consequences of rising debts in just a decade's time. First it will be high risk premiums (interest on debt) and lower economic growth, after 2040 the risk of default will already be 90%. Demography, namely population ageing, will suppress economic growth too. Thus, the next government is being advised to take fiscal consolidation measures.

(trend.sk)