Slovakia – an opportunity for new Japanese investments
Slovakia after the Velvet revolution in 1989 and the split of the Czechoslovak federation in 1993 went through a period of substantive political, economic, and social transformation. The most dynamic economic branches currently in Slovakia are machinery (mostly automotive industry), production of electronic and electrical components, information and communication technologies, as well as the chemical and pharmaceutical industry. Slovakia is now No.1 in the world in regards to production of cars per capita and also a leader in industrial robotization. It belongs to the TOP 20 countries with the highest number of industrial robots in a production industry per 10 000 employees. In 2021 the GDP growth was 3,0% and the prediction for 2022-2023 is about 2,0-3,0%.
After a very successful period of economic growth in 2000 -2015, a process of a new re-structurization of the Slovak economy has started. Such a process always opens a window of opportunity for new investments. The country will welcome Japanese investors with a higher value-added production - including research and development. Slovakia has already been a successful investment destination for about 70 Japanese companies, employing in total 13 000 people. The biggest companies from this list are Minebea Slovakia, Yazaki Wiring Technologies Slovakia, Panasonic Industrial Devices Slovakia, Akebono Brake Slovakia, Fuso Industries Slovakia, Brother Industries and SIIX EMS Slovakia, AAF Daikin, Takeda Pharmaceutical, and others.
Slovakia is a very investor-friendly country, and the Slovak Government is continuously increasing the quality of local business and investment environments. In the recent years, major effort was put into supporting less developed regions with higher unemployment rate. In East Slovakia, the extent of an investment aid can reach up to 35% of the original investment value in case of industrial projects, technology centres or shared services centres. Available forms of aid are corporate income tax relief, cash grant, contribution for newly created jobs, and a reduction of rent for a real estate in public ownership (up to 90%). Eligible are costs for land acquisition, building construction, new technological equipment, licences, patents, rent for buildings and land, wage of new employees for the period of two years etc.
Slovakia provides attractive investment schemes and a special tax regime even for research and development activities, and for production with a higher value-added. In the area of research and development, in 2015-20 Slovakia introduced a very favourable tax regime – ‘super deduction’ – which allows to reduce an income tax of a company by 200% of the cost incurred on the research and development.
Potential investors can contact the Embassy of Slovakia (email) and the Slovak Investment and Trade Development Agency (SARIO) (email), which can provide a complete set of services including professional consulting, a list of industrial parks, and assistance in purchasing or renting real property.