Slovakia is on the tail in the use of Eurofunds: We lost the fastest millions
Slovakia is at the tail of the EU, together with Romania and Croatia, at the pace of drawing Eurofunds, when only a little over half of the allocated funds were exhausted from the 14.4 billion euro package by March this year.
In addition to the risk of underspending, the funds will reduce their fair value of high inflation. This reduced the value of unspent money from the 2014-2020 programming period by approximately EUR 200 million compared to 2015, stated by analysts in the currency, statistics and research (ÚMS) department of the National Bank of Slovakia.
“If we had not been late in drawing, we could have bought goods and services in the additional amount of 200 million euros at the price of 2015,” stressed analyst Marián Labaj. Slovakia kept pace with the drawdown of Eurofunds with the last season only until 2018. Prior to the pandemic, the EU17, like Slovakia, drew an average of ten percent of its allocation annually. In the following years, due to a poorly installed system of another, we permanently lost resources in the amount of almost 200 million euros, when in Slovakia part of the allocation was reduced, for example, due to dubious redistribution of funds for science and research.
According to Labaj, a large volume of unspent Eurofunds would not be a problem as a result, if we can accelerate the drawdown. “We have similar experience from the second programming period. In 2013, two years before the end of the drawdown, we needed to use half the resources. This more or less succeeded,” reminded the analyst. Slovakia has to use the euro almost seven times by the end of next year. However, the cards are shuffled by higher inflation, which will cause a real drawdown. With the expected higher inflation, the transfer of unused funds to the next two years deprives us of their real contribution to Slovakia’s development.
Due to the inflated inflation loss of approximately EUR 200 million in 2015, Slovakia lost one large infrastructure project, such as the construction of the R2 Košice, Šaca – Košické Oľšany road or the modernization of the train fleet.
“The rise in the price level will thus eliminate the purchasing power of Eurofunds. So far, the problem of Eurofunds has been perceived mainly in the context of efficient and effective allocation. However, its important role must be devoted to the time dimension, on two levels – to draw fast enough and to deliver decomitment and fast enough to minimize the inflationary impact, “Labaj.