Slovakia Faces High Risk of Fiscal Crisis as Government Abandons Consolidation Plans

The European Commission has identified Slovakia as the only European Union member state facing high risk to public finances in both the medium and long term. The government of Prime Minister Robert Fico has abandoned earlier fiscal consolidation plans that would have kept the budget deficit around 2 percent and reduced public debt. Instead, current spending patterns have created a fiscal situation so precarious that the difference in planned versus actual spending could have funded two complete hospitals annually. The state is currently constructing new hospitals in Prešov and Martin at a combined cost exceeding one billion euros, highlighting the scale of resources that could have been available under more disciplined fiscal management. Slovakia's ruling Smer-SD party, led by Fico, returned to power in 2023 after winning parliamentary elections on a platform that included increased social spending. The European Commission's assessment places Slovakia in a uniquely vulnerable position among EU member states, as other countries have managed to maintain more sustainable fiscal trajectories. The warning comes as the EU has been pressing member states to reduce debt levels and maintain fiscal discipline following the economic disruptions of recent years.