Economic Outline

Economic Indicators

Slovenia has been an open market since its successful economic transition in 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. After contracting due to the COVID-19 pandemic, Slovenia’s GDP rebounded quickly. However, the country’s economy grew by 1.6% in 2024, slowing from 2.1% in 2023 and 2.7% in 2022, according to the country's Statistical Office. Household and government spending contributed positively to GDP growth, while gross fixed capital formation and external trade had a negative impact on growth. Economic growth is forecast to accelerate to 2.5% in 2025 and 2.6% in 2026, as private consumption is expected to grow strongly, supported by employment growth and rising real wages. Investment is projected to increase, driven by the deployment of RRF-financed measures and cohesion policy projects, as well as higher demand for machinery and equipment due to improving financial conditions and stronger export demand. Meanwhile, imports are expected to rise in line with higher consumption and investment. The contribution from net exports to growth is expected to remain neutral in 2025 and turn negative in 2026, according to EU Commission data.

In 2024, Slovenia's budget deficit was just 1.2% of GDP, the lowest in five years (official governmental data). Revenue surpassed the projected EUR 14 billion, reaching EUR 14.6 billion, mainly due to record employment, higher salaries, strong business performance, and additional revenue from the Reconstruction, Development, and Provision of Financial Resources Act. This included a temporary corporate income tax increase and EUR 280 million from the Slovenian Sovereign Holding, allocated to flood recovery efforts. On the expenditure side, EUR 15.4 billion was spent, below the planned EUR 16.2 billion, resulting in savings of EUR 0.8 billion. Unspent funds for flood recovery were due to uncertainties in implementation, though nearly EUR 0.5 billion was allocated for aid, and EUR 530 million was invested in the Reconstruction Fund. In 2025, the deficit is projected at 2% (IMF). After increasing due to the COVID-19-led crisis, the public debt-to-GDP ratio decreased to 67.4% in 2024 (from 68.4% one year earlier) and is expected to further decelerate to 65.5% by 2026 (IMF). Similarly, Slovenia's average annual inflation decreased to 2% in 2024, down from 7.4% in 2023, according to data from the Statistical Office of Slovenia (SSO). Inflation in Slovenia is expected to rise slightly to 2.7% in 2025, as consumers face higher electricity bills due to the reintroduction of charges suspended during the energy price crisis and increases in grid fees. Services inflation is projected to remain high, driven by rapid wage growth. However, inflation is forecast to ease to 2.1% in 2026 (data IMF).

After strong growth in 2023, employment growth stagnated in the first half of 2024. Limited availability of workers remained the dominant factor in the labour market, according to companies, while wages continued to rise. The unemployment rate was estimated at 3.5% in 2024 and should remain broadly neutral over the forecast horizon (IMF). According to the latest data from Eurostat, around 14% of the population is at risk of poverty or social exclusion, the second-lowest ratio in the EU. 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. Overall, the IMF estimated the country’s GDP per capita (PPP) at USD 55,683 in 2024, still below the EU average.

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