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Slovakia has a population of 5.5 million. It belongs to the group of high-income countries. It has been a EU member since 2004. Slovakia joined the Eurozone in January 2009.

Intra-EU trade is important. It accounts for 79% of Slovakia’s exports (mostly Germany) and 80% of its imports.

The country is less exposed to foreign financial shocks than other central European economies, benefitting from Euro membership. However, Slovakia is a small open economy, with significant exposure to the automotive sector. As a result, Slovakia was hit hard by the COVID-19 outbreak through lower exports to western Europe. Inflation and the twin deficits (fiscal and current account balances) were under control before the outbreak, giving enough leeway to ease the fiscal stance during the shock. Euro membership was again a strength, since Slovakia benefitted from ECB monetary easing measures.