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Economic Overview

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Slovenia has been an open market since its successful economic transition of the 2000s. As a member of the European Union since May 2004 and of the Eurozone since 2007, Slovenia is an advanced, independent, and stable country. The weak performance of Slovenia’s main trading partners (the country maintains a long tradition of trading with neighbouring countries, making it vulnerable to its neighbours’ economic health) had already slowed down growth in 2020 (-4.2%) with the situation worsening due to the COVID-19 pandemic, which caused a contraction in all demand components except government consumption. Overall, the IMF estimated the country’s GDP to have grown to 6.3% in 2021 thanks to a rebound in private consumption as well as increased investments both from the public and private sectors. The IMF also forecast growth will reach 4.6% in 2022 and 3.7% in 2023.

Similarly, the government budget was burdened by the measures taken to cushion the effects of the pandemic, which had a total budgetary impact of around 7% of GDP (including wage compensations, exemptions from pension and disability insurance contributions, tourism vouchers, a monthly basic income for self-employed workers and farmers, etc.). Therefore, the overall deficit was estimated at 7% by the IMF, with a forecast of -4.1 for 2022 and -2.5% in 2023. The drop in GDP and the large deficit caused a sharp increase in the debt-to-GDP ratio, which went from 65.6% in 2019 to approximately 77.2% in 2021. It is then projected to gradually fall to 74.9% and 73.0% in 2022 and 2023, respectively, on the back of the economic recovery. Inflation got back to its pre-crisis level in 2021 (at 1.4%) but is expected to keep growing over the course of 2022 (1.8%).

Unemployment has been on a declining trend in recent years, and after an increase to 5.0% throughout 2020 it has stabilized at 4.5% in 2021. Job losses have been uneven and largely concentrated in some service sectors. The unemployment rate is forecast to reach 4.3% in 2022 and 4.2% in 2023 (IMF). According to the latest data from Eurostat, 14.3% of the population is at risk of poverty or social exclusion, well below the EU average of 21.9%. Nevertheless, poverty amongst the senior population, consisting of mostly women and marginalized minorities, is an area of severe concern; to address this, the government deployed a specific strategy for elder people.

 
Main Indicators 201920202021 (e)2022 (e)2023 (e)
GDP (billions USD) 54.1953.55e60.8965.4870.13
GDP (Constant Prices, Annual % Change) 3.3-4.26.34.63.7
GDP per Capita (USD) 26,03925,54928,93931,02633,173
General Government Balance (in % of GDP) -0.1-6.8-7.0-4.1-2.5
General Government Gross Debt (in % of GDP) 65.679.8e77.274.973.0
Inflation Rate (%) 1.6-0.11.41.81.8
Unemployment Rate (% of the Labour Force) 4.55.0e4.54.34.2
Current Account (billions USD) 3.253.953.894.144.16
Current Account (in % of GDP) 6.07.46.46.35.9

Source: IMF – World Economic Outlook Database , October 2021

Note: (e) Estimated Data

Country Risk

See the country risk analysis provided by La Coface.

 

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Main Sectors of Industry

Slovenia has a skilled and productive labour force of around 1 million people out of its 2.08 million population. The agricultural sector is declining and reached only 2.1% of the GDP, employing around 4.3% of the population in 2021 (World Bank). Total utilized agricultural area equates to 30.6% of the total area of the country, with 4.8% of agricultural holdings dedicated to organic production (plus 5.4% in the system of control of organic production). Forestry is a key economic factor, with 66% of land area forested and an annual production value of EUR 250 million to the economy. According to the latest figures by the Slovenian Statistical Office, the value of the agricultural output in 2021 is expected to amount to EUR 1,318 million, 20% lower than one year earlier. The value decrease is the consequence of lower volume (by 12%) and higher prices (by 9%).

The industrial sector represents 29.4% of GDP and one-third of employment (34.1%). Historically, the dominant industries in Slovenia have been the forestry, textile, and metallurgical industries. Since the 1980s, the mechanical industries (automobile, tool machines) and the high value-added industries (electronics, pharmacy, and chemicals) have been greatly developed. The World Bank estimates the manufacturing sector to contribute 20% of GDP. Slovenia's industrial production increased by 10.2% in terms of value in 2021, following a 6.2% decline in the previous year (Slovenian Statistical Office).

The tertiary remains the most significant sector in the Slovenian economy. It represents 56.9% of the GDP and employs 61.6% of the total workforce, and has shown a strong growth pattern during the last ten years, especially in the fields of information and communications technology (ITC), financial, commercial services, and retail business. The tourism sector is very dynamic and has been undergoing a period of strong development in recent years (helped by the Strategy for Sustainable Development of Slovenian Tourism for 2017-2021). In 2021, 4 million tourist arrivals and more than 11 million tourists overnight stays in Slovenia were recorded, which is 31% more arrivals and 22% more overnight stays than the previous year.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 4.3 34.1 61.6
Value Added (in % of GDP) 2.1 29.4 56.9
Value Added (Annual % Change) 3.9 -3.1 -3.8

Source: World Bank - Latest available data.

 
Monetary Indicators 20162017201820192020
Euro (EUR) - Average Annual Exchange Rate For 1 USD 0.940.890.850.890.88

Source: World Bank - Latest available data.

 

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Foreign Trade

Slovenia is highly open to foreign trade, which represents about 146.5% of the country's GDP (World Bank, latest data available). This high level of openness makes Slovenia very dependent on the economic health of its main commercial partners: Slovenia is integrated within German and Austrian production chains for automobiles and electrical and electronic equipment, and in Swiss chains for the pharmaceuticals industry, and generates more than half of its goods exports from these four sectors. Due to the drop in global demand during the global financial crisis and the economic difficulties of the EU countries, Slovenia's exports had decreased. Since 2011, however, exports have been increasing continuously. The largest share of total exports in 2020 was contributed by medicaments (19.2%), motor cars (8.6%), parts of motor vehicles (2.6%), and petroleum oils (1.9%); with imports following a similar trend: medicaments (14.6%), motor cars (4.8%), petroleum oils (3.8%), and parts of motor vehicles (2.5%).
 
According to data by Comtrade, in 2020 the main export destinations were Germany (18.0%), Switzerland (12.1%), Italy (9.3%), Croatia (8.0%) and Austria (6.4%); whereas imports came chiefly from Germany (14%), Switzerland (12.7%), Italy (10.8%), Austria (7.5%) and China (7.3%). Slovenia has an external trade deficit with EU member states that has been decreasing in recent years. On the other hand, the country has had an external trade surplus with EU non-member countries.
 
Slovenia’s trade balance is structurally positive: in 2020 the trade surplus stood at 9.2% of GDP, according to the World Bank. Both exports and imports of goods decreased during the year: exports stood at USD 44.8 billion in 2020 stable y-o-y), while imports were at USD 42.1 billion (-4.3%). The country is also a net exporter of services, with exports totalling USD 7.8 billion and imports at USD 5.5 billion (-18% and -13.6%, respectively).
According to the latest figures from the Slovenian statistical office, compared to 2020, in 2021 exports were higher by 19.8% (amounting to EUR 39.4 billion) and imports by 30.8% (amounting to EUR 42.0 billion). The export/import ratio in 2021 was 93.8%, and the deficit amounted to EUR 2.6 billion (the highest in the past ten years).

 
Foreign Trade Values 20162017201820192020
Imports of Goods (million USD) 30,44936,07842,26744,00742,120
Exports of Goods (million USD) 32,85038,44344,20044,94344,797
Imports of Services (million USD) 4,6775,0556,3646,3595,492
Exports of Services (million USD) 7,2108,1849,5599,5547,831

Source: World Trade Organisation (WTO) ; Latest available data

Foreign Trade Indicators 20162017201820192020
Foreign Trade (in % of GDP) 146.7157.3161.2159.3146.5
Trade Balance (million USD) 1,6921,8301,5231,4932,862
Trade Balance (Including Service) (million USD) 3,8424,3854,6134,6095,134
Imports of Goods and Services (Annual % Change) 6.310.77.14.7-9.6
Exports of Goods and Services (Annual % Change) 6.211.16.24.5-8.7
Imports of Goods and Services (in % of GDP) 69.174.176.475.368.7
Exports of Goods and Services (in % of GDP) 77.683.184.884.077.9

Source: World Bank ; Latest available data

Foreign Trade Forecasts 20212022 (e)2023 (e)2024 (e)2025 (e)
Volume of exports of goods and services (Annual % change) 10.07.74.24.23.3
Volume of imports of goods and services (Annual % change) 10.98.65.35.54.4

Source: IMF, World Economic Outlook ; Latest available data

Note: (e) Estimated Data

 
International Economic Cooperation
Slovenia is a member of the EU since 1st May, 2004 and as such is a member of the EU Customs Union.
 

Main Partner Countries

Main Customers
(% of Exports)
2020
Germany 18.0%
Switzerland 12.1%
Italy 9.3%
Croatia 8.0%
Austria 6.4%
See More Countries 46.1%
Main Suppliers
(% of Imports)
2020
Germany 14.0%
Switzerland 12.7%
Italy 10.8%
Austria 7.5%
China 7.3%
See More Countries 47.6%

Source: Comtrade, Latest Available Data

 

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Political Outline

Current Political Leaders
President: Borut Pahor (since 22 December 2012, re-elected for a second term in 2017)
Prime Minister: Janez JANSA (since 13 March 2020)
Next Election Dates
Presidential: November 2022
National Council: 2022 
National Assembly: 24 April 2022
Main Political Parties
Slovenia is a parliamentary republic with a multi-party system. The major parties in Slovenia are:

- Slovenian Democratic Party (SDS): centre-right, party to the ruling coalition government
- List of Marjan Sarec (LMS): social -liberal, populist, primary opposition party
- Social Democrats (SD): centre-left
- Modern Centre Party (SMC): social-liberal, party to the ruling coalition government
- New Slovenia-Christian Democrats (NSi-KD): centre-right
- Democratic Party of Slovenian Pensioners (DeSUS): centrist, party to the ruling coalition government
- Party of Alenka Bratušek (SAB): centre, social liberism
- The Left (Levica): eco-socialist
- Slovanian National Party (SNS): slovenian nationalism

Executive Power
The President is the head of the state and is elected by a popular vote for a five-year term (renewable once). The role of the President is largely ceremonial. Following parliamentary elections, the leader of the majority party or the leader of a majority coalition is usually nominated to become Prime Minister by the President and elected by the National Assembly to serve a four-year term. Prime Minister is the head of the government and enjoys the executive powers which include implementation of the law in the country and running the day-to-day affairs. The Council of Ministers (cabinet) is nominated by the Prime Minister and elected by the National Assembly.
Legislative Power
The legislature is bicameral in Slovenia. The parliament consists of:

  • National Assembly (the lower house) having 90 seats; out of which 88 are elected through proportional voting and 2 members elected by ethnic minorities, members serve four-year terms,
  • National Council (the upper house, more like an advisory body) having 40 seats; with its members elected indirectly (members representing social, economic, professional, and local interests) to serve five-year terms.

The National Assembly is the most important power centre in the country. The executive branch of government is directly or indirectly dependent on the support of the National Assembly. The Prime Minister cannot dissolve the parliament, only the president can do it in certain circumstances.

 

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COVID-19 Country Response

COVID-19 epidemic evolution

To find out about the latest status of the COVID-19 pandemic evolution and the most up-to-date statistics on the COVID-19 disease in Slovenia, please visit the official portal of the government of Slovenia.
For the international outlook you can consult the latest
situation reports published by the World Health Organisation as well as the global daily statistics on the coronavirus pandemic evolution including data on confirmed cases and deaths by country.

Sanitary measures

To find out about the latest public health situation in Slovenia and the current sanitary measures in vigour, please consult the dedicated page on the official portal of the government of Slovenia, including the up-to-date information on the containment measures put in place and public health recommendations. Further information can be accessed on the website of the National Institute of Public Health (NIJZ) and on the official website Slovenia.info.

Travel restrictions

The COVID-19 situation, including the spread of new variants, evolves rapidly and differs from country to country. All travelers need to pay close attention to the conditions at their destination before traveling. Regularly updated information for all countries with regards to Covid-19 related travel restrictions in place including entry regulations, flight bans, test requirements and quarantine is available on TravelDoc Infopage.
It is also highly recommended to consult COVID-19 Travel Regulations Map provided and updated on the daily basis by IATA.
The US government website of Centers of Disease Control and Prevention provides COVID-19 Travel Recommendations by Destination.
The UK Foreign travel advice also provides travelling abroad advice for all countries, including the latest information on coronavirus, safety and security, entry requirements and travel warnings.

Import & export restrictions

Following the measures taken by the European Commission, an export license is required to export personal protective equipment outside of the European Union.
For a general overview of trade restrictions due to COVID-19 pandemic, please consult the section dedicated to Slovenia on the
International Trade Centre's COVID-19 Temporary Trade Measures webpage.

Economic recovery plan

To know about the economic measures taken by the Slovenian government to address the impact of the COVID-19 pandemic on the national economy, please visit the dedicated page on the official portal of the government of Slovenia. Further info can be found on the websites of the Slovene Enterprise Fund (in Slovenian) and of the Ministry of Economy (in Slovenian). Updates are available on the “News” section of the government’s portal. For an overview of the measures, consult the guide by Deloitte.
The information on the EU’s economic response to COVID-19 and the actions to minimise the fallout on the EU member states’ economies of the COVID-19 outbreak is available on the websites of the
European Commission and the European Council.
For the general overview of the key economic policy responses to the COVID-19 outbreak (fiscal, monetary and macroeconomic) taken by the Slovenian government to limit the socio-economic impact of the COVID-19 pandemic, please consult the section dedicated to Slovenia in the
IMF’s Policy Tracker platform.

Support plan for businesses

For the information on the local business support scheme and taxation measures established by the Slovenian government to help businesses to deal with the economic impacts of the COVID-19 epidemic on their activity, please consult the dedicated page on the portal of the government of Slovenia and the official website of SpiritSlovenia (in Slovenian). For further info refer to Slovene Enterprise Fund (in Slovenian).
For a general overview of international SME support policy responses to the COVID-19 outbreak refer to the World Bank's Map of SME-Support Measures in Response to COVID-19.

Support plan for exporters

To find out about the support plan for exporters put in place by the Slovenian government, please consult the website of the national promotional development bank SID Banka (in Slovenian). For updates refer to the “News” section of the government’s portal.
The European Commission adopted a
Temporary Framework for State aid measures to support the economy in the COVID-19 outbreak, which enables short-term export credit insurance to be provided by the State where needed.

 

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