Slovenia’s GDP Grew by 2.5% Last Year

According to the Statistics Service, in 2016 Slovenia’s GDP grew by 2.5%, which exceeds the average index among the EU countries. The materials of the pan-European Eurostat Service indicate the same data.

In the IV quarter of 2016, a seasonally adjusted GDP grew by 1.2% as compared to the III quarter. Over the previous months of the last year, the increase was as follows: I quarter—0.6%, II quarter—0.7%, III quarter—1%.

As compared to the same period of 2015, the economic growth in Slovenia, taking into account seasonal correlations, increased by 3.6% in the fourth quarter of 2016.

The first estimate of statisticians is even more optimistic than the forecast of Slovenian and international experts who predicted that the GDP of Slovenia would range from 2.0% to 2.3% by the end of 2016.

Exports Is the Driving Force of the Economy

In the past year, as in previous years, exports was the main driver of the economy. As a result, in accordance with the methodology of fixed prices, exports grew by 5.9% and imports—by 6.2%. Exports added 4.6 percentage points to the aggregate indicator of the country’s GDP.

In addition, the domestic consumption plays an increasing role. Last year it grew by 2.4% and added 2.2 percentage points to the total GDP of Slovenia.

Household Consumption Reaches the Pre-crisis Level

In 2016, the household consumption increased by 2.8%, while in the IV quarter it jumped up by 4.1% reaching the maximum value at the end of the period. This increase, according to experts, was recorded in early 2008 before the economic crisis.

The Number of Transactions in Buying and Selling Objects of Secondary Real Estate Reaches the Pre-crisis Levels

Gross investments in 2016 increased by 1% mainly due to reduced inflows in the first quarter (in annual terms) and a relatively slow growth in the second and third quarters. Investment growth in the fourth quarter accelerated significantly and reached 3.8%.

Gross investment in fixed assets increased by 0.9% in the IV quarter of 2016, but due to the reduction in public investment because of a decline in revenue from the European funds, it decreased by 3.1% in annual terms.

Investments of companies in technical modernization rose by 9.4% in the IV quarter of 2016, while investments in construction projects decreased by 6.8%, which is slightly less than in the previous quarter. With this, the investments in housing construction rose by 3%.

The Statistical Service noted that the number of transactions in selling and buying objects of the secondary real estate in Slovenia had reached the pre-crisis indicators. In the III quarter of 2016, a growth in the primary market is not yet observed. Experts believe that the growth of domestic consumption this year will lead to a gradual increase in demand for property.

Department of Macroeconomic Analysis and Development: Indicators of Growth Exceed the Average EU Index

The Statistics Service will publish the final data on the last year’s GDP growth in Slovenian at the end of August. In 2016, experts predicted economic growth of 2.9% and then reduced this estimate to 2.3%.

This year, the growth may be even greater, and according to some reports, such as the Department of Macroeconomic Analysis and Development (Umar) and the European Commission, it may even reach 3%.

The Department noted that the last year’s GDP figure, according to its data, is again superior to the average value among the EU countries. The last year’s growth in Slovenia was one of the highest in the EU. In the IV quarter of 2016, the growth rate significantly exceeded the average of the EU countries.

Experts believe that the main factor of macroeconomic development is the growth of competitiveness of Slovenian companies and, as a consequence, an increase in exports. They note the improvement of the situation in the manufacturing sector, the service sector and the labour market.