Systémové účinky tzv. privatizačnej pasce na transformáciu slovenskej ekonomiky
THE SYSTEM EFFECTS OF SO CALLED PRIVATIZATION TRAP ON THE TRANSFORMATION PROCESS OF THE SLOVAK ECONOMY

Summary/Abstract: The real development in transition economies also the example of Slovak Republic, show that transition economies find themselves in a disequillibrium situation. This stage of disequillibrium is result of a big transition recession, higher increase of prices than in standard economies, passive account of balance of payments, disequillibrium at the labour market, high unemployment rate and high financial distress of Slovak companies. The article is aimed at consequences of privatization process arisen from buy-out by domestic entities using foreign capital. In analysis, authors have combined the macro-economic and microeconomic approach towards assessing the financial situation of the whole business sector in Slovak republic. Based on the analysis, privatization process using foreign capital may evoke a situation of so called privatization or investment trap. Privatization by foreign capital also increases the capital demand and at the same time, it has an impact on the rise of inflation. If the inflation is being hold under a restrictive policy of the central bank and if there is a low economic growth in the country, then the economic situation of privatized companies is getting worse. Investments of companies increase, employment decreases, the loss of companies and internal debt of companies is rising. Part of the work is aimed at the mechanism of the finance leverage effect in connection with privatization process and companies financial structure in Slovak republic. The financial structure of the majority of companies in Slovak republic is not good. Companies have got a high share of short-term foreign capital and low share of long-term financial sources. Another problem of companies is a high level of financial distress, not performing financial market and low rate of return on assets. The way of privatization process to present, not paying loans (situation of default) and low level of payment discipline in companies are the factors which are in many cases the cause of financial distress in companies. Therefore, from the banks point of view, providing loans is a very risky activity, which has a negative effect on the whole supply of loans and conditions for providing loans. The risk arising from investing into own capital is very high mainly concerning minor shareholders. An inevitable assumption for improving the financial situation of companies in Slovak republic is to improve the framework conditions for financing business sphere.

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