Slovakia

1) REFERENCES

Commission Opinion [COM(97) 2004 final - Not published in the Official Journal]Commission Report [COM(98) 703 final - Not published in the Official Journal]Commission Report [COM(99) 511 final - Not published in the Official Journal]Commission Report [COM(2000) 711 final - Not published in the Official Journal]Commission Report [COM(2001) 700 final - SEC(2001) 1754 - Not published in the Official Journal]Commission Report [COM(2002) 700 final - SEC(2002) 1410 - Not published in the Official Journal]Commission Report [COM(2003) 675 final - SEC(2003) 1209 - Not published in the Official Journal]Treaty of Accession to the European Union [Official Journal L 236 of 23.09.2003]

2) SUMMARY

In its Opinion of July 1997 the European Commission expressed the view that Slovak industry could encounter difficulties with integrating into the European market in the medium term. In order to avoid such difficulties, Slovakia was urged to diversify away from heavy industries and to restructure enterprises more effectively. The Commission also considered the lack of investment capital to be a major potential impediment to restructuring and diversification efforts. The problem was due to low levels of foreign investment, the bad debt situation and the privatisation process which was oriented towards insiders and therefore insufficiently transparent.

The November 1998 Report confirmed that progress had been made in defining an industrial policy, but stated that implementation would require close monitoring. Significant efforts were needed to improve the integration of competition aspects into industrial and enterprise-restructuring policies, to manage privatisation projects in a transparent manner and to promote foreign direct investment.

The October 1999 Report highlighted the fact that certain problems, including the state of the financial system, were obstacles to economic development. The new Slovakian Government was striving to improve the situation of industry.

The November 2000 Report noted that industrial policy in Slovakia had moved closer to EU policy, although there were still problems with regard to compliance with Community state-aid rules. Steps forward had been taken with the adoption of a long-term industrial strategy. There was adequate administrative capacity to implement industrial policy. The taxation scheme for SMEs had been simplified and support programmes for SMEs had been streamlined.

The November 2001 Report indicated that progress had been made in the field of privatisation and the promotion of investment. There had been little improvement in the promotion of competitiveness and the development and coordination of policy. Progress had been recorded with regard to policies in favour of SMEs and improving their environment.

The October 2002 Report detailed the progress made by Slovakia in the field of industrial policy and particularly in promoting investment and privatisation. The policy in favour of SMEs had been revised and the business environment improved.

The November 2003 Report stated that Slovakia is generally meeting the commitments and requirements arising from the accession negotiations in the field of industrial policy and more specifically with regard to SMEs.

The Treaty of Accession was signed on 16 April 2003 and accession took place on 1 May 2004.

COMMUNITY ACQUIS

EC industrial policy seeks to enhance competitiveness, thus achieving rising living standards and high rates of employment. Its aim is to speed up adjustment to structural change, encouraging an environment favourable to initiative, to the development of undertakings throughout the Community and to industrial co-operation, and to foster better exploitation of the industrial potential of innovation, research and technological development policies. EU industrial policy combines instruments from a number of Community policies, and includes both instruments related to the operation of markets (product specification and market access, trade policy, State Aid and competition policy) and measures related to industry's capacity to adapt to change (stable macro-economic environment, technology, training etc.).

In order to cope with competitive pressure and market forces within the Union, the industry of applicant countries will need to have achieved a certain level of competitiveness by the time of accession. The governments of applicant countries need to be seen to be pursuing policies aimed at open and competitive markets along the lines set out in Article 157 (ex-Article 130) of the EC Treaty. Cooperation between the EU and the candidate countries in the fields of industrial cooperation, investment, industrial standardisation and conformity assessment as provided for in the Europe Agreement is also an important indicator of development in the right direction.

EVALUATION

In 2002, Slovakia consolidated the existing legal framework in the field of industrial policy. Efforts still needed to be made, however, to ensure effective enforcement of the legislation, particularly as regards bankruptcy and insolvency procedures. The necessary administrative structures are in place. Foreign investment is increasing and efforts have been made to encourage investment in general. Restructuring and privatisation are well under way.

Slovakia has made progress since the 1997 Opinion in drawing up an industrial policy which conforms with Community principles. This chapter has been provisionally closed and no transitional arrangements have been requested (see 2002 Report). Slovakia will need to coordinate its administrative structures and improve the competitiveness of its enterprises.

As regards its policy on SMEs, Slovakia has revised its overall strategy for the period 2002 - 2006 with the specific aim of improving the business environment.

The European Charter for Small Enterprises was adopted in April 2002 and should continue to be implemented.

Administrative structures have been adapted more to SMEs' needs. The same applies for business support services.

Access to finance should, on the other hand, be further improved.

Slovakia has made progress since the 1997 Opinion in introducing a policy in favour of SMEs. This chapter has been provisionally closed, no transitional arrangements have been requested and Slovakia has met its commitments (see 2002 Report).

Slovakia is participating in the Third Multiannual Programme for SMEs (1).

(1) Decision of the Association Council between the European Communities and their Member States, of the one part, and the Slovak Republic, of the other part of 4 November 1998 adopting the terms and conditions for the participation of the Slovak Republic in the Community programme in the field of small and medium-sized enterprises.

Official Journal L 35 of 09.02.1999

Last updated: 25.02.2002