Slovenia is a small but prosperous country located in the heart of Europe. Its economy is characterized by its high GDP per capita, low unemployment rate, and strong industrial base. Slovenia is a member of the European Union (EU) and has been part of the Eurozone since 2007. Since joining the EU in 2004, Slovenia has seen an impressive economic growth, with GDP growth reaching 3.7% in 2019. The country has also seen a steady increase in foreign direct investment (FDI), which reached €3.3 billion in 2018.
According to cheeroutdoor, Slovenia’s economy is mainly based on services and manufacturing. Services account for around 75% of its GDP and include activities such as finance, insurance, real estate and business services as well as tourism which contributes significantly to the country’s economy. Manufacturing makes up around 15% of Slovenia’s GDP and includes industries such as automotive parts production, textiles, chemicals and food processing. In addition to this Slovenia also benefits from a strong agricultural sector which produces crops such as wheat, barley and maize as well as dairy products including cheese and butter.
The Slovenian government has implemented a number of reforms over recent years in an effort to improve its economic performance including tax reforms which have lowered corporate taxes from 22% to 19%. In addition to this there have been efforts to reduce red tape for businesses operating in Slovenia by simplifying administrative procedures related to starting up businesses and registering property rights. These measures have had positive influences on FDI flows into the country over recent years leading to higher levels of foreign investment into the country’s manufacturing sector as well as into research & development activities which will help further bolster economic growth in future years.
Slovenia’s accession to the EU single market has been beneficial for its exports which have increased significantly since that time with exports accounting for almost two-thirds of Slovenia’s GDP while imports accounted for nearly one-third of it in 2018. The main export partners are Germany, Italy, Austria and Croatia while the main import partners are Germany, Italy and Austria. As a member of the EU single market, Slovenia enjoys free movement of goods within the bloc as well as access to other markets such as North America through free trade agreements with countries such as Canada. In addition, Slovenia has signed several bilateral agreements with other countries such China, South Korea etc., that have helped facilitate increased trade between them both.
In conclusion, it can be said that despite its small size, Slovenia’s economy has achieved impressive results over recent years due largely due to prudent fiscal policies implemented by its government along with accession into EU single market. This has enabled it attract significant amounts foreign direct investment into various sectors of its economy thereby ensuring sustained economic growth over recent years.
Before the dissolution of Yugoslavia, Slovenia was the richest and most industrialized of all the republics of the Union. With only eight percent of Yugoslavia’s total population, the republic accounted for 17 percent of gross domestic product (GDP) and 30 percent of exports to Western Europe. In the first period after independence, the country experienced a short-term economic decline. After a few years of economic decline and high unemployment, economic growth increased, while unemployment fell. As the first of the new EU countries, Slovenia joined the Eurozone in 2007.
Of the service industries, finance (banking, insurance) and tourism are particularly important sources of income for Slovenia.
Since 2014, Slovenia has experienced strong growth. GDP increased by 2.3 percent in 2015, 3.1 percent in 2016 and 4.0 percent in 2017. GDP per capita in 2017 amounted to USD 34,100. Unemployment in 2017 was 6.8 percent and inflation at 1.6 percent.
Abbreviated as SLO by abbreviationfinder.org, Slovenia has an excellent infrastructure and a well-trained workforce.
Agriculture and forestry
The total agricultural area constitutes 22.8 percent of the land. More than half of the agricultural land is used as pasture. Among other things, it is grown maize, wheat, sugar beets, potatoes, cabbage and fruit (apples and pears, as well as grapes for wine production). Cattle are especially kept for milk and meat production, poultry and pigs, as well as some sheep. In 2016, agriculture’s contribution to GDP was 2.3 percent
62.3 percent of the country is covered by forests, and forestry has traditionally been an important industry. Most of the harvest goes to timber and pulp.
The farming of fish, mainly trout and carp, has increased in recent years. In 2016, production was 1612 tonnes. Deep sea fishing, on the other hand, is negligible. According to Eurostats, only 200 tonnes were fished in 2015.
In 2015, the coal mine at Velenje, 58 km northeast of the capital Ljubljana, produced 3.2 million tonnes of coal. The mining business employs 1300 people, and it is planned to continue mining until 2054. In addition, lead and zinc are recovered, as well as smaller amounts of salt, oil and natural gas. Slovenia has smaller deposits of uranium and mercury.
31.9 percent of the country’s energy consumption is covered by hydropower. Slovenia has one nuclear power plant in Krsk, which was built in 1983 to meet energy needs in both Slovenia and Croatia. By a 1995 agreement, ownership of the power plant was shared equally between the two countries. This power plant covers 34.4 percent of Slovenia’s energy needs, while coal accounts for 31.8 per cent. Slovenia imports both oil and gas.
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The largest industrial branches are the metal and workshop industries, which are located in Ljubljana and Celje, among others. There is considerable electronic industry in Ljubljana, and the textile industry in Maribor and Kranj. The heavy industry is particularly located in Ljubljana and Jesenice. Otherwise, chemicals, foodstuffs, wood-based products (including paper), footwear, motor vehicles etc. are produced.
Industrial production, which in 2017 contributed 32 per cent of the country’s gross domestic product, grew by 2.5 percent this year. 31.7 percent of the country’s working population was then employed in the industry.
Slovenia exports machinery and transport equipment, in particular electrical appliances, office machines, road machinery and parts, clothing and accessories and chemicals. The main import goods are machinery and transport equipment, chemicals and various factory products.
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In 2017, total exports amounted to USD 30.23 billion, while imports were USD 28.7 billion.
In 2016, Slovenia’s five main export markets were as follows: Germany (19.3 percent), Italy (10.4 percent), Austria (7.5 percent), Croatia (7.3 percent) and Hungary (4.4 percent). The five most important markets for Slovenian imports were: Germany (16.8 percent), Italy (13.5 percent), Austria (9.9 percent), Croatia (5.5 percent) and China (4.8 percent).
Transport and Communications
Slovenia’s geographical location means that the country is a natural transit country for road and rail traffic between northern and southern Europe, and there are good connections especially in the northwest-southeast direction. There are a total of 38 985 km of roads. The railway network is at 1229 km. Koper is the country’s most important port city. In 2016, 22 million tonnes of goods were loaded/ unloaded at the port, representing a six percent increase over 2015. The port of Koper is a duty-free zone. Other important ports are Portorož and Izola. There is some transport on the river Drava, which is a bee to the Danube.
Note: the capital city of Slovenia is Ljubljana with a population of 286,000 (estimate 2019). Other major cities include Maribor with a population of 109,000, Crane with a population of 42,500, Celje with a population of 38,000 (estimate 2019).