Economic trends
Member of the European Union since May 2004 and of the eurozone since 2007, Slovenia is an advanced, reliable and independent country, which underwent successful economic transition in the 2000s. Slovenia is an open market and there is a long tradition of trading with neighboring countries such as Germany, Austria and Italy. Because of its stability, the Slovenian economy has long performed well. Slovenia boasts a skilled and productive labor force and its unemployment rate has long been among the lowest in Europe.
However, since 2011, the country has faced social and financial difficulties caused in part by its strong integration into the European economy. Economic growth is not likely to exceed 1.7% in 2012. Unemployment has doubled in the last three years (12% in 2011), public debt too has increased and is expected to pass the 50% GDP mark in 2012 (it was only 23.4% in 2007). The new Conservative government elected in December 2011 has adopted an austerity budget including a decrease in the deficit and government spending, wage freezes, reduced state spending and a pension reform which increased the retirement age from 63 in 2011 to 65.
Slovenia has many economic advantages and remains an economically dynamic country, however its economic health depends largely on that of its neighbors.
Main branches of industry
During the last few years, agriculture has declined considerably, contributing only 2.5% to the GDP (compared to 4.2% in 1995).
The industrial sector represents about one third of the GDP. Historically, the dominant industries in Slovenia were forestry, textile and metallurgical industry. Since the 1980s, the mechanical industries (automobile, tool machines) and the high value-added industries (electronics, pharmacy, chemicals) have been greatly developed.
The Slovenian economy is becoming more and more based on services. This sector, which represents more than 60% of the GDP, has experienced a strong growth during the last ten years, especially in the fields of information technology and communication, financial and commercial services and retail business. Tourism too is booming and remains a sector with high economic potential.
International trade
Slovenia is a founding member of WTO. It is highly open to foreign trade, which represents more than 100% of its GDP. Its three main clients are Germany, Italy and Croatia. More than 40% of its GDP is exported into the European Union, especially vehicles, electric & electronic equipment and pharmaceutical products. Its network of SMEs is recognized for its innovative capabilities and environmental friendliness. As a platform between Western and South-Eastern Europe, Slovenia is the second largest foreign investor in the Balkans.
Its three main suppliers are Germany, Italy and Austria. The country's main imports are vehicles, machinery, mineral fuels and oil, iron and steel.
This high level of openness makes Slovenia very dependent of the economic health of its main commercial partners. Due to the drop in global demand in 2008-2009 and the following economic difficulties of teh EU countries in 2011, Sloven exports have decreased and the deficit of the trade balance has deteriorated.
Foreign trade in Slovenia is structurally in deficit with Western Europe where its main partners are located. Some exports have shown resistance to the economic crisis, especially metals and generic pharmaceutical products, as well as the exports of tool machines and electronic equipment. Once the economic conditions of Slovenia's main partners (Italy and Germany) improves, the level of imports and exports should revive and increase again in 2012.
© Export Entreprises SA, all rights reserved.
Last updates: May 2012
