Macroeconomic Overview

The core focus of Slovenia’s government is to continue building a modern and efficient economy by supporting innovation, increasing FDI inflows, raising export levels and driving up productivity. As a company’s production network expands, there are new destinations of investment to help extend its geographical reach and a structured, facts-based approach to pick the best available location for the optimisation of its product value chain. Investor weighing a country’s operating conditions and their impact on performance metrics such as lead times, total cost of ownership and the financial bottom line, will agree the skills of the local workforce make a major contribution to productivity and economic success.

With the challenging economic prospects over the next couple of years, Slovenia will continue to focus its resources where businesses and the economy as a whole should benefit most. Bundled with the measures aimed at meeting the commitments of the Euro Plus Pact designed to increase competitiveness, promote employment and have a positive effect on fiscal sustainability and stability, there are numerous government-sponsored programmes to improve the skills of employees, boost the capability of local suppliers and enhance Slovenia’s proposition to inward investors.

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Macro-Stability of Slovene Economy

According to Maastricht's criteria key elements in a macro-stability package are low inflation together with maintained price stability and a commitment to low budget deficit. Macro-stability cannot be divorced from unemployment as well. Consequently macro-stability is an effective means of achieving sustained economic growth. According to the statistics, Slovenia's main advantages in comparison to European Union are economic growth and investments in R&D, meanwhile the main disadvantage is account deficit as a per cent of GDP.

Main Economic Indicators

Indicators	2012	2013	2014	2015	2016 forecast	2017 forecast	2018 forecast
GDP (real growth rates, in %)	-2.7	-1.1	3.0	2.9	1.7	2.4	2.3
GDP in EUR million	35,988	35,907	37,303	38,543	39,598	40,613	41,880
GDP per capita (PPS)*	21,500	21,500	22,600	-	-	-	-
GDP per capita, in EUR	17,498	17,435	18,093	18,680	19,179	19,670	20,283
Trade balance, as % of GDP	2.6	5.6	7.0	7.3	7.5	6.8	6.3
Gross external debt in EUR million	42,872	41,658	46,314	44,723	44,541	-	-
Gross external debt, as % of GDP	119.1	116.0	124.2	116.0	-	-	-
Standardised rate of unemployment (ILO)	8.9	10.1	9.7	9.0	8.6	8.1	7.5
Labour productivity (% of GDP per employee)	-1.8	0.3	2.5	1.4	0.8	1.5	1.7
Inflation, year average	2.6	1.8	0.2	-0.5	-0.3	1.3	1.3
Average exchange rate USD/EUR	1.286	1.328	1.329	1.110	1.111	1.114	1.114

* PPS - Purchasing Power Standard

Source: Institute of Macroeconomic Analysis and Development, 2016

Value Added in Slovenia

The global financial crisis has contributed to a significant slowdown of value added growth in manufacturing, retail trade and construction. Despite the sizeable decline in 2009, value added is increasing since then, but at a relatively slow pace.

The moderate growth of value added will also continue in 2016 and 2017. The main engine of growth will remain export-oriented manufacturing activities, but with a further increase in the export of services (particularly transport, travel and knowledge-intensive services) and a gradual strengthening of domestic private consumption, a significant contribution to value added growth will continue to be made by non-financial services.

Value added by activities; real growth rates in % (2017 forecast)

Source: IMAD - Autumn forecast of economic trends 2015

Value Added in Slovenia

Structure of gross value added, 2013 (as a % of total economy), international comparison