Slovenia: Worst crisis since independence

Slovenia is experiencing the worst crisis since independence, as GDP is expected to contract by about 6% in 2009. A weak rebound should occur in 2010 as exports pick up. Inflation will continue to moderate on the back of a rising output gap and higher unemployment.

A significant decline in investment, particularly in civil engineering projects and housing, due to dearer and scarcer sources of funds and uncertainty about the timing of a global recovery, will drag the economy.

A relatively favourable fiscal position prior to the crisis gave room for discretionary fiscal stimulus. However, any new fiscal package should avoid measures that may jeopardise long-term fiscal sustainability. The credibility of fiscal policy needs to be bolstered by a new pension reform that deals with rising prospective ageing costs.

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©OECD Observer No 274, July 2009

Economic data

GDP growth: +0.5% Q2 2019 year-on-year
Consumer price inflation: 1.9% August 2019 annual
Trade: +0.4% exp, -1.2% imp, Q1 2019
Unemployment: 5.1% August 2019
Last update: 9 September 2019

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