Slovakia’s recovery and resilience plan

Following an unprecedented crisis due to the pandemic, Slovakia’s recovery and resilience plan responds to the urgent need of fostering a strong recovery and making Slovakia ready for the future. The reforms and investments in the plan will help Slovakia become more sustainable, resilient and better prepared for the challenges and opportunities of the green and digital transitions. To this end, the plan consists of 196 “mutually agreed deliverables”, namely qualitative milestones and quantitative targets that track the progress in implementing the plan’s reforms and investments. The plan will be supported by €6.3 billion in grants.43% of the plan will support climate objectives and 21% of the plan will support the digital transition.

The expected transformative impact of Slovak’s plan is the result of a combination of wide-ranging and complementary reforms and investments, which address the specific challenges of Slovakia. The reforms address in particular the bottlenecks to a lasting and sustainable growth. The investments are targeted to accelerate the transition towards a more sustainable, low-carbon and resilient economy, to facilitate the digital transformation of businesses and the society and to reinforce social resilience by improving quality of education and healthcare systems. All reforms and investments have to be implemented within a fixed and challenging time frame, as the Regulation on the Recovery and Resilience Facility stipulates that all measures have to be completed by August 2026.

The plan will contribute significantly to economic growth and job creation in Slovakia. These estimates do not include the possible positive impact of structural reforms, which can be substantial. The plan could lead to a gross domestic product (GDP) gain of 1.3-2.1% by 2026. This would translate into up to 20,000 additional jobs. Slovakia will also benefit significantly from the recovery and resilience plans of other Members States, as positive cross-border demand spill-overs account for 0.6 pp of this GDP effect through increased Slovak exports. Structural reforms in the Slovak plan will bear their fruits especially in the medium and long run, which could result in a gross domestic product gain of at least 5.3% by 2040, three quarters of which are assumed to come from better human capital, increased Slovak labour force and stronger research and innovation. This demonstrates the added value of joint and coordinated action at the European level.

+ 1.3-2.1%

Impact of NextGenerationEU on Slovakia's gross domestic product by 2026

+ 20,000

Jobs by 2026

0.6%

Gross domestic product benefits thanks to other Member States’ recovery and resilience plans in 2040

When designing the plan, the Slovak authorities consulted national and regional social partners and stakeholders, while pursuing a close dialogue with the Commission. The formal submission of the plan took place on 29 April 2021. On 21 June 2021, the Commission gave its green light to the plan. On this occasion, President von der Leyen symbolically transmitted the Commission’s assessment to Prime Minister Heger during a visit in Bratislava. The plan was adopted by the Council on 13 July 2021, opening the door to its implementation and financing.

Recovery and resilience plan for Slovakia

Green transition

In the area of climate and environmental policies, Slovakia faces the challenge of the transition towards a greenerenergy mix, more sustainable mobility, better energy and environmental performance of buildings, increased biodiversity protection, adaptation to climate change and development of the circular economy.

Key measures for the green transition

The plan supports the green transition through an investment of €528 million for a large-scale renovation to make at least 30 000 family houses more energy-efficient. Investment of around €368 million into the decarbonisation of industry will spur energy efficiency improvements and deployment of innovative technologies. Furthermore, €712 million will be invested into sustainable transport to support the roll-out of around 3000 charging stations for alternative fuels, the modernisation of railways and 200km of new cycling infrastructure. This investment will be further enhanced by a comprehensive reform creating integrated public transport systems in six regions. Measures for climate change adaptation will combine investments of €150 million with reforms in the area of nature protection, water management and landscape planning to preserve biodiversity. The investment will result in 90km renatured watercourses and the promotion of a more sustainable local economy.

Example project: Energy efficiency in family houses

The plan supports a comprehensive renovation of family houses promoting improved energy performance and adaptation to the changing climate (e.g. green roofs, water retention systems). The investment of €528 million will result in renovation of 30 000 family houses and on average to at least 30% primary energy savings. To reach out to homeowners, regional centres will be created and accompanied by a communication campaign. In addition, the investment will promote the recycling of construction materials and prevention of and demolition waste supported by a reform offering simplified and user-friendly access to the support schemes.

Digital transition

Digital challenges

Slovakia´s performance in the digital ranking of EU Member States remains weak. Slovakia faces challenges related to alow level of digitalisation of public administration and public services, slow uptake of digital technologies, insufficient digital skills, and gaps in broadband coverage and the deployment of 5G.

Key measures for the digital transition
The plan supports the digital transition with reforms and investments supporting digitalisation of the public administration, including areas like education, healthcare and justice. With an investment of €177 million, the plan aims at providing better services for citizens and businesses by introducing user-friendly e-government solutions. An investment of around €102 million will help businesses with their digitalisation through a network of digital innovation hubs to assist them in digitalising business processes and provide trainings in digital skills. In addition, investments will support the development of a new Slovak supercomputer and participation in other cross-border EU projects. Quality and digitalisation of schools will be supported through €187 million to finance digital equipment, including for children from socially disadvantaged backgrounds, to enhance digital skills and create a new learning ecosystem, which will be further strengthened by an essential curriculum reform.

Example project: Better services for citizens and businesses (e-government)

The Slovak plan put forward an investment introducing user-friendly e-government solutions for 16 priority situations in the life of citizens and businesses. In parallel, public administration entities will undergo a profound digitalisation of the underlying work processes. At present, Slovak administrative procedures for the most common “life situations” often involve interactions with multiple entities of public administration, which rely on different degrees of digitalisation of processes and different IT systems. This investment has the ambition to increase the output quality of public services and reduce their duration, costs and resource requirements. It will ultimately reduce the administrative burden for individuals and businesses.

Economic and social resilience

Key socio-economic challenges for the Slovak economy include a poor education outcomes and skills of pupils - in particular from socially disadvantaged background – and low enrolment rate of children in pre-school facilities. Slovakia’s health outcomes are weak and life expectancy is among the lowest in the EU. Slovakia´s ability to increase competitiveness and productivity requires improving innovation and promoting sectoral diversification, but the low quality of public research and limited cooperation with businesses constrain the transfer of knowledge and skills. Public administration and the business environment suffer from administrative complexity and inefficiencies. These challenges weigh on potential growth and employment.

Key measures in reinforcing economic and social resilience

The plan reinforces economic and social resilience with measures fostering inclusive education systems at all levels. Moreover, it will improve the access to and the quality of the inpatient and outpatient health care and enhance long-term care services. The modernisation of the hospital network should help increase the quality and cost-effectiveness of medical services, while ensuring fair geographical distribution and accessibility. This will be combined with investments aimed at improving the accessibility of primary care services in underserved regions. Significant infrastructure investments will be in particular targeted at modernisation of hospital buildings (€989 million) and increasing capacities of pre-school facilities (€141 million). Enhancing social and health care capacities will combine a reform and investments of around €193 million for those in needthrough community- based solutions. To support the innovation potential, the plan intends to reform RDI governance and invests around €738 million into support schemes to mobilise excellent researchers and projects, public-private research cooperation, injecting new capital and microloans to companies and providing innovation vouchers to SMEs. The plan includes a reform to improve the business environment by accelerating public procurement and reforming the insolvency framework to reduce the time and cost for running a business. Reorganisation of the justice system combines a reform to improve efficiency and independence and investments of €255 million into courts´ infrastructure and digitalisation.

Example project: Reform of the content and form of education

The objective of the reform is to create a new learning curricula of primary and lower-secondary schools. By changing the content of education, this reform will help better develop pupils’ critical thinking, soft skills, such as problem-solving, handling information and working in a team, and digital skills.

The plan is consistent with relevant country-specific challenges and priorities identified in the European Semester, the annual cycle of coordination and surveillance of the EU’s economic policies. For a detailed explanation of the European Semester see the following link: The European Semester explained | European Commission (europa.eu)