Slovak Employers' Chief Warns of 'Greek Path' Without Fiscal Reforms

Slovakia risks repeating Greece's economic collapse unless politicians implement serious fiscal reforms, the head of a major Slovak employers' association warned. Rastislav Machunka, chairman of the Association of Employers' Unions and Associations (AZZZ), one of Slovakia's largest business lobby groups, called for the abolition of the so-called 13th pension — an annual bonus payment made to retirees on top of their regular pension — as well as the scrapping of energy subsidies and a broader reduction of state social spending. Machunka also urged a lower tax burden on businesses to restart economic growth. Machunka's warning comes amid growing concern over Slovakia's public finances. Slovakia runs a significant budget deficit, and the government of Prime Minister Robert Fico has faced criticism from economists and international institutions over its spending trajectory. The 13th pension, introduced as a populist measure, has been a point of contention between fiscal hawks and the ruling coalition, which relies heavily on support from pensioners. Machunka argued that politicians across the spectrum are aware the country is heading in the wrong direction but continue to prioritize their own electoral interests, having conditioned voters to expect state entitlements. The remarks highlight a deepening tension between Slovak business leaders and the political establishment over the country's long-term fiscal sustainability. Without structural changes, Machunka warned, Slovakia faces the kind of sovereign debt crisis and economic dysfunction that brought Greece to the brink of collapse in the early 2010s, requiring international bailouts and years of painful austerity.