Slovenia overview


In Slovenia we focus on:

Corporate sector restructuring, expanding the role of the private sector and promoting good corporate governance. Lifting the obstacles presented by excessive leverage and poorly structured corporate finances is a precondition for preventing a rapid rise in insolvencies, stabilising the banking sector and arresting the on-going economic contraction. The EBRD is seeking bankable opportunities to help restore financial viability of companies with sound underlying businesses. We will participate in the privatisation of key enterprises currently under state control, either through debt or equity financing.

Stabilising the financial sector. In what will likely be a protracted process of deleveraging, recapitalisation and consolidation, the EBRD will assist in bank asset restructuring, support healthy banks with medium term funding for the real sector, and help build up alternative funding channels. Progress with balance sheet cleansing and credible commitment to governance reform in the banking sector will open up opportunities for providing support for the privatisation of state-controlled banks.

Supporting sustainable energy. The EBRD will explore sustainable energy and resource efficiency investment opportunities, particularly in the SME sector and the residential sector. The Bank will also actively seek opportunities to identify and finance investments that would increase the renewable energy generation capacity in the country.

The EBRD’s latest strategy for Slovenia was adopted on 26 February 2014

Current EBRD forecast for Slovenia’s real GDP growth in 2018 4.2%

Current EBRD forecast for Slovenia’s real GDP growth in 2019 3.3%

The economy continued to expand strongly in the first half of 2018 (by 4.2 per cent year-on-year), although a bit slower than in 2017 (4.9 per cent). The growth was driven by domestic demand, underpinned by both higher investment and private consumption. While export performance remained strong, imports continued to catch up. Stronger growth led to a fall in the unemployment rate to below 6.0 per cent in the first half of 2018 and to labour shortages becoming more prevalent.

This year Slovenia has exited the Macroeconomic Imbalances Procedure and the improvement in the general government balance has continued. However, public debt remains high at 73 per cent of GDP (end-June 2018), and there is a need for structural reforms in areas such as a sustainable public wage system motivating employees, and also in others linked to the ageing of the society, including pensions, health care, long-term care and education (especially life-long learning).

Economic growth is likely to moderate in the short term, to 4.2 per cent in 2018 and 3.3 per cent in 2019, as the temporary effects of the new EU funding cycle subside and the economy reaches its potential. While downside risks come from possibly weaker demand from Slovenia’s main trading partners, as well as slow pace of structural reforms and privatisation, a stronger than envisaged government investment cycle and growth in private consumption could push up growth rates above projections.