COMMISSION STAFF WORKING DOCUMENT 2025 Country Report - Slovenia Accompanying the document Recommendation for a COUNCIL RECOMMENDATION on the economic, social, employment, structural and budgetary policies of Slovenia
Date: 2025-06-04
Institutions: European Commission, Reform and Investment Task Force
Subjects: Slovenia, administrative formalities, budget policy, economic policy, economic recovery, economic reform, employment policy, renewable energy, social policy, stability pact

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 4.6.2025  SWD(2025) 224 final  COMMISSION STAFF WORKING DOCUMENT 2025 Country Report - Slovenia Accompanying the document Recommendation for a COUNCIL RECOMMENDATION on the economic, social, employment, structural and budgetary policies of Slovenia     {COM(2025) 224 final}  
 
 
 
 
ECONOMIC DEVELOPMENTS AND KEY POLICY 
CHALLENGES 

Growth is expected to continue 
despite headwinds 

the  pandemic, 

Since 
the  Slovenian 
economy  has  remained  resilient  and 
growth  has  been  sustained.  Despite  the 
energy  price  shock  and  the  major  floods  of 
2023, Slovenia’s GDP is now over 10% higher 
than  it  was  in  2019.  In  2024,  Slovenia’s  GDP 
increased by 1.6%, driven mainly by domestic 
demand.  Slovenia’s  economy  is  characterised 
by a diverse service and industrial sector, with 
an  emphasis  on  exports.  Slovenia  has  been 
able  to  maintain  and  increase  its  export 
market  share,  indicating  a  good  competitive 
position.  The  country’s  economic  growth  is 
driven  by  a  diversified  range  of  industries, 
including  automotive,  pharmaceuticals  and 
electronics.  

Slovenia’s  economy  remains  firmly  on  a 
convergence path with the rest of the EU. 
Labour productivity is catching up with the EU 
average, although it remains some 15% below 
is 
the  EU  average.  Looking  ahead,  GDP 
expected  to  grow  by  2%  and  2,4%  in  2025 
and  2026,  respectively,  driven  by  continuous 
strong  domestic  demand.  However, 
the 
economic  outlook  remains  highly  uncertain  in 
view  of  possible  US  tariffs  due  to  the  high 
level  of  integration  of  Slovenia  within  the 
global  value  chain.  While  in  2024,  1.5%  of 
Slovenia’s goods exports went to the US based 
on the foreign trade statistics (1), there is also 
significant indirect exposure due to the impact 
of tariffs on exports to other countries. 

(1)  Due  to  the  trade  of  pharmaceuticals  with  Switzerland, 
the  share  of  trade  with  the  US  could  be  currently 
large  differences 
underestimated  and 
between  foreign  trade  and  balance  of  payments 
statistics. 

there  are 

in 

2024, 

The  job  market  is  strong,  but  shortages 
of  workers  are  increasing.  Employment 
increased  modestly 
and 
unemployment  remained  broadly  unchanged 
at  the  very  low  level  of  3.7%.  The  proportion 
of  people  of  working  age  who  are  working  or 
looking for a job has reached a very high level 
for  almost  all  age  groups.  At  the  same  time, 
Slovenia’s  population  is  ageing,  and  limited 
availability  of  workers  is  likely  to  become  a 
structural  feature  of 
(see 
Section 4). The unemployment rate is expected 
to  remain  low  in  the  coming  years,  while 
employment  growth 
is  mainly  driven  by 
foreign  workers.  Vacancy  rates  remain  high, 
and  companies  consider  the  availability  of 
workers  to  be  one  of  their  major  challenges, 
particularly in construction and services.  

the  economy 

is 

in  over 

lowest  value 

The  financial  position  of  households  and 
corporates 
relatively  strong.  The 
corporate debt-to-GDP ratio is at around 35%; 
its 
two  decades. 
Corporate  credit  growth  turned  negative  in 
2023  and  was  among  the  lowest  across  the 
EU.  Profits  i.e.,  gross  operating  surplus,  of 
companies  are  strong,  with  some  evidence  of 
a peak in 2023, followed by a small decline in 
2024. Household debt is low and continued to 
decline  on  the  back  of  passive  reduction  of 
debt  levels.  The  household  debt-to-GDP  ratio 
reached  24%  in  2023.  The  banking  sector 
remains  well  capitalised  and  its  profitability 
close  to  the  EU  average.  At  1.6%  (Q3-2024), 
the non-performing loans ratio is close to the 
EU average. 

Public finances have further 
improved 

The general government deficit continued 
to decline, reaching 0.9% of GDP in 2024, 
supported  by  moderate  tax  increases. 

2 

 
 
 
in 2024 and 2025 taken together is projected 
at  9.3%,  which  is  below  the  maximum  rate 
recommended by the Council.  

Strong  demand  in  the  housing  market  is 
driving up prices. In real terms, house prices 
increased  by  5.1% in  2024,  following  a  slight 
decline  of  0.2%  in  2023.  Since  2015,  house 
prices  have  risen  faster  than  household 
income,  by  approximately  15 percentage 
points (pps), but they are estimated to be only 
slightly  overvalued  (4).  The  rent-to-income 
ratio  has  remained  relatively  stable  since 
2015.  However,  new  housing  supply  lags 
behind demand, putting additional pressure on 
prices. The number of transactions fell by 21% 
in  2024,  with  transactions  of  new  dwellings 
falling by 50%. Overall, the European Systemic 
Risk  Board  has  assessed  that  the  housing 
market  does  not  pose  a  high  risk  to  financial 
stability (5).  

Sustaining competitiveness 
remains a key challenge  

However, 

years (6). 

Slovenia remains competitive and is able 
to  increase  its  export  market  share.  Cost 
competitiveness  has  come  under  pressure  in 
non-cost 
recent 
competitiveness  aspects  (e.g.  quality,  service) 
continue  to  provide  an  advantage  in  some 
sectors.  The  Bank  of  Slovenia’s  analysis (7) 
indicates  that  a  1%  rise  in  the  unit  cost  of 
labour  reduces  exports  by  0.2%  for  the 
average  Slovenian  manufacturing  firm.  The 
cost sensitivity of exports is also slightly below 
average in the manufacture of pharmaceutical 
products,  which  is  the  largest  manufacturing 

(4)  Alert Mechanism Report 2025. 

(5)  European Systemic Risk Board (2024), Follow-up report 
on vulnerabilities in the residential real estate sectors of 
the EEA countries, February 2024. 

(6)  In  2023,  the  real  effective  exchange  rate  appreciated 
by  close  to  3%,  but  it  is  forecast  to  have  depreciated 
again in 2024. Unit labour costs increased by more than 
8%  in  2023,  but  also  this  indicator  improved  in  2024 
with lower inflation. 

(7)  Review 

of  macroeconomic 

developments 

and 

projections, December 2024. 

further 

state-owned 

Revenue-increasing measures were introduced 
over  2024-2028  to  finance  reconstruction 
following the floods of 2023. These measures 
included  a  higher  corporate  income  tax  rate 
and  a  new  tax  on  banking  assets.  Dividends 
from 
enterprises  markedly 
increased.  A  strong  job  market  and  high 
corporate  profitability 
supported 
personal  and  corporate  income  tax  revenues. 
The  general  government  deficit  is  forecast  to 
increase in 2025 to 1.3% of GDP, mostly due 
to  the  first  phase  of  the  public  sector  wage 
reform  over  2025  -  2028  and  lower  property 
income  revenue.  If  no  new  measures  are 
taken,  the  general  government  deficit 
is 
forecast  to  increase  to  1.5%  of  GDP  in  2026. 
The gross government debt stood at 67.0% of 
GDP at the end of 2024 and is forecast to fall 
to  65.5%  of  GDP  in  2025,  and  to  63.8%  of 
GDP in 2026.  

Slovenia  has  committed 
to  further 
consolidate  public  finances  by  keeping 
net expenditure growth below the growth 
rate  recommended  by  the  Council  over 
2025-2028.  In  2024,  net  expenditure  (2)  in 
Slovenia  grew  by  4.5%  (see  Annex  1).  This 
increase  is  mainly  driven  by  higher  social 
benefits,  compensation  of  employees  and 
intermediate 
size  of 
discretionary  revenue  measures  was  1.0%  of 
GDP. The revenue-increasing annual impact of 
these  measures 
from  net 
expenditure.  Similarly,  the  impact  of  one-off 
flood-reconstruction  measures 
also 
deducted  from  net  expenditure.    In  2025,  net 
expenditure  is  forecast  by  the  Commission  to 
grow  by  4.6%,  which  is  below  the  maximum 
growth  rate  recommended  by  the  Council (3). 
The cumulative growth rate of net expenditure 

consumption.  The 

is  deducted 

is 

expenditure, 

(2)  Net expenditure is defined in Article 2(2) of Regulation 
(EU)  2024/1263  as  government  expenditure  net  of  (i) 
revenue 
(ii) 
interest 
measures, (iii) expenditure on programmes of the Union 
fully  matched  by  revenue  from  Union  funds,  (iv) 
national  expenditure  on  co-financing  of  programmes 
(v)  cyclical  elements  of 
funded  by 
unemployment  benefit  expenditure,  and  (vi)  one-off 
and other temporary measures. 

discretionary 

the  Union, 

(3)  Council  Recommendation  of  21  January  2025 
endorsing  the  national  medium-term  fiscal-structural 
plan  of  Slovenia  (OJ  C,  C/2025/640,  10.2.2025,  (ELI: 
http://data.europa.eu/eli/C/2025/640/oj). 

3 

 
 
 
above  the  EU  average  but  falls  short  of  the 
national target (further analysed in Section 2).  

Shortages  of  skilled  workers,  energy 
costs  and  uncertainty  about  the  future 
seem to be the main long-term obstacles 
for investment in Slovenia (8). In particular, 
ICT  and  green  skills  are  in  high  demand  (see 
Annex  10).  In  Q4-2024,  the  overall  vacancy 
rate was 2% in Slovenia, but it reached 4% in 
construction,  and  accommodation  and  food 
services. Slovenia has some of the highest job 
EU,  with 
market 
simultaneous  severe  shortages  and  surplus 
occupations.  The  movement  of  workers  from 
less  productive  to  more  productive  industries 
appears low.  

imbalances 

the 

in 

Regulatory  hurdles  in  certain  sectors 
remain higher than in the rest of the EU. 
Regulatory  restrictiveness  is  higher  than  the 
EU  average  for  professions  such  as  lawyers, 
real  estate  agents,  civil  engineers  and 
architects.  In  particular,  the  profession  of 
lawyer is more strictly regulated than in other 
economies  and 
fragmented  system 
regulating civil engineers could hinder the free 
movement of professionals and their services. 

the 

High  energy  costs  and  technological 
change  are  negatively  affecting  some 
industries.  In  2023,  output  fell  by  20%  in 
chemicals  manufacturing,  18.5%  in  the  paper 
industry  and  8.4% 
in  metal  production, 
followed  by  some  recovery  in  production  in 
2024. Electricity prices have increased and are 
significantly  influenced  by  volatile  fossil  fuel 
prices  due  to  the 
interconnectedness  of 
Slovenia’s  electricity  market  with  the  markets 
rate  of 
of  neighbouring  countries.  The 
installing  renewable  generation  capacity  has 
been  slow,  particularly  for  wind  generators 
(see  Section  3  and  Annex  8).  Moreover, 
Slovenia’s  automotive 
facing 
challenges  to  remain  competitive  amid  the 
ongoing  shift 
to  electric  vehicles.  Weak 
demand  in  export  markets  negatively  impacts 
this sector (see Annex 7). 

industry 

is 

(8)  2023  European  Investment  Bank  Investment  Survey 

(EIBIS). 

industry. The share of exports of medium- and 
high-tech  products  is  above  the  EU  average 
and  has  steadily  increased  since  2017.  The 
services  balance  remains  positive,  driven  by 
strong  performances  in  transport  and  tourism 
services. 

Low private investment is a long-
standing issue and key challenge 
for competitiveness 

to 

the 

Slovenia’s  business  investment  is  lower 
than the EU average. Investment, as a share 
of  GDP,  has  on  average  been  1.8 pps  lower 
than the EU average over 2013-2023. 1.3 pps 
is  attributable 
lower  business 
investment.  Therefore,  Slovenia’s  potential 
total  factor 
growth  heavily  depends  on 
productivity 
capital 
deepening (i.e. more capital being invested per 
worker)  has  a  limited,  if  not  a  negative  role. 
The 
investment, 
combined with a shrinking labour force (due to 
ageing)  will  exert  significant  pressure  on 
Slovenia’s economic potential in the long term.  

(TFP)  growth,  while 

level  of 

relatively 

low 

Graph 1.1: Contribution to labour productivity 
growth 

(1) Growth based on real GDP per hour worked. 
(2) The dashed line indicates the start of forecast values. 
Source: European Commission (Autumn 2024 Economic 
Forecast) 

Companies  are  investing  in  machinery 
and  equipment  but  much 
in 
intangible  assets.  Investment  in  R&D  is 

less 

4 

-9.0-7.5-6.0-4.5-3.0-1.50.01.53.04.56.07.5% changeCapital deepeningTFPLabour productivity 
   
 
There remains room for a higher 
quality of public finances 

is 

facing 

The  economy 
significant 
spending  pressures,  which  could  require 
improvements  in  the  quality  of  public 
costs,  defence 
spending.  Ageing-related 
spending, and investment spending to address 
the  competitiveness  gap  will  put  pressure  on 
public  finances.  Slovenia  is  developing  a  new 
green budgeting framework, which is expected 
to  improve  the  quality  of  public  finances  and 
contribute  to  the  green  transition (9).  More 
efficient  public  procurement  can  yield  savings 
and help redirect resources to areas in greater 
need.  Implementation  of  spending  reviews  to 
improve  the  quality  of  public  finances  can 
for  other  spending  needs, 
create 
including  for  major  reforms 
(e.g.  health 
reform).  

room 

level  of 

the  high 

level  of  public 
Despite 
investment,  there  is  scope  for  improving 
the  management  of  public  investment  in 
Slovenia, particularly in the early phases 
of  planning  and  selection.  The  long-term 
strategic  planning  of  public  investment  is 
carried  out  mostly  at  the 
line 
ministries,  with  limited  coordination  across 
sectors and limited involvement of the Ministry 
(10).  While  a 
of  Finance 
standardised 
methodology  for  project  assessment  is  in 
place,  it  seldom  applies  before  the  budget 
allocation,  which  can  lead  to  delays  and 
significant  cost  increases  during  execution. 
Moreover, 
quality 
assurance  to  assess larger  projects is lacking. 
increases  during 
This  contributes  to  cost 
execution. 
development 
programme  presents  expenditure  by  project 
increases 
over  a  four-year  period.  This 
transparency,  and  capital  expenditure  ceilings 

systematic 

external 

national 

The 

(9)  Ministry  of  Finance,  2023,  https://www.gov.si/assets/ 

ministrstva/MF/Proracundirektorat/Drzavni-
proracun/NRP/Metodologija-zazeleno-proracunsko-
nacrtovanje.pdf. 

are  set  two  years  in  advance.  There  is, 
however,  no  standard  methodology 
for 
estimating maintenance costs. Ex post reviews 
of projects are carried out on an ad hoc basis, 
and  asset  registers  are  required  to  be  kept 
updated across the general government (11).  

faces 

medium 

Slovenia 
fiscal 
sustainability  risks  in  both  the  medium 
and  the  long  term.  Debt  is  projected  to 
decline  slightly  before  increasing  again  over 
the medium term, reaching about 68% of GDP 
in  2035.  The  medium  risks  in  the  long-term 
stem  from  the  projected  increase  in  ageing-
related  costs  and  the  unfavourable  initial 
deficit  and  debt  levels.  Pension  expenditure 
makes  up  around  two  thirds  of  rising  ageing 
costs,  and  healthcare  and  long-term  care 
expenditure around one third (see Annex 1 and 
Debt Sustainability Monitor 2024) (12) (13).  

(11)  Republic of Slovenia: Technical Assistance Report-Public 
Investment  Management  Assessment,  October  2024, 
https://www.imf.org/en/Publications/technical-
assistance-reports/Issues/2024/10/04/Republic-of-
Slovenia-Technical-Assistance-Report-Public-
Investment-Management-Assessment-555893. 

(12)  Debt Sustainability Monitor 2024. 

(10)  Belu  Manescu,  C.  (2024),  The  planning  of  public 
investments  in  EU  Member  States:  long-term  strategy, 
selection  and  budgeting  issues,  DG  ECFIN  Discussion 
Paper no. 213. 

(13)  These projections do not take into account the recently 
negotiated  pension  reform,  which  is  expected  to  start 
impacting  ageing  related  expenditures  already  in  the 
medium-term. 

5 

 
 
 
 
Box 1: 

UN Sustainable Development Goals (SDGs)  

Slovenia  is  making  progress  on  all  SDGs  related  to  competitiveness  and 
productivity  (SDGs 8  and  9)  although  there  is  still  room  for  improvement.  In 
particular, Slovenia has made progress on R&D and innovation (SDG 9). Gross 
domestic expenditure on R&D has increased from 1.96% of GDP in 2018 to 2.13% in 
2023 but remains below the EU average of 2.22%. An area that needs attention is the 
low share of buses and trains in passenger transport (13.9% in 2022, compared to the 
EU average of 16.6%).  

•  Slovenia performs well on indicators measuring employment (SDG 8). In 
particular,  the  percentage  of  young  people  not  in  employment,  education  or 
training  is  lower  than  the  EU  average  (7.6%  in  2024;  EU  average:  11.0%). 
However, while the quality of education (SDG 4) is above the EU average, there 
are  signs that  Slovenia is diverging  from  certain targets  for  quality  education, 
particularly due to recent negative trends in basic skills, including digital skills. 

•  Slovenia performs well on poverty and basic needs (SDG 1), with a low share 
of people at risk of poverty or social exclusion (14.4% in 2024) compared 
to the EU average (21% in 2024). However, the share of people at risk has been 
rising since 2021 (see Annex 11). 

•  Slovenia performs well on SDG 13, reducing its net greenhouse gas emissions 
from 8.9 tonnes per person in 2018 to 7.3 tonnes in 2022. Nevertheless, it has 
been  moving  away  from  the  targets  for  responsible  consumption  and 
production (SDG 12), particularly the target  for per capita waste  generation, 
with  an  average  material  footprint  significantly  above  the  EU  average  (see 
Annex 7).  

•  Slovenia’s  performance  is  below  the  EU  average  on  7  out  of  the  17 
indicators.  These  relate  to:  (i)  environmental  stability  (SDGs 2,  9,  12,  13);  (ii) 
good  health  and  well-being,  particularly  in  access  to  healthcare  (SDG  3); 
(iii) gender  equality  (SDG  5),  although  improvements  have  been  made;  and 
(iv) macroeconomic stability in the area of peace, justice and strong institutions 
(SDG 16) (see Annex 15). 

6 

 
 
 
Box 2: 

Barriers to private and public investment 

Slovenia’s  private  investment  remains  somewhat  low  while  public  investment  is  rather  high. 
Several barriers could contribute to this disparity: 

•  Shortages of workers and skills. A large share of companies report low availability 

of workers as the main barrier to investments in the long term.  

•  Uncertainty  about  the  future.  As  a  small,  open  economy,  Slovenia  is  highly 

dependent on trends in export markets.  

•  Energy costs. High energy costs hamper investment and reduce the competitiveness of 

exports. 

Slovenia’s efficient management of public investments faces several barriers: 

• 

Long-term  strategic  planning  of  public  investment.  There  is  limited  coordination 
across ministries and limited involvement of the Ministry of Finance (14). 

•  Selection  of  investments.  The  fact  that  the  standard  methodology  for  project 
assessment  seldom  applies  before  the  budget  allocation  and  a  lack  of  systematic 
external quality assurance can lead to cost increases in the execution phase. 

The  implementation  of  Slovenia’s  RRP  faces  challenges.  Investments  are  highly  concentrated 
towards the end of the implementation period, which can create significant capacity challenges 
at various levels and therefore merit special attention. At present, Slovenia has fulfilled 32% of 
the milestones and targets in its RRP.  

It remains important to accelerate the implementation of cohesion policy programmes. The mid-
term review offers opportunities to speed up progress and better address EU strategic priorities 
related to competitiveness, defence, housing, water resilience and the energy transition. 

While  Slovenia  has  signalled  interest  in  leveraging  the  Strategic  Technologies  for  Europe 
Platform under cohesion policy, Slovenia can further support the development or manufacturing 
of  critical  technologies  in  the  areas  of  digital  and  deep  tech,  clean  and  resource  efficient 
technologies, and biotechnologies. 

(14)  Belu  Manescu,  C.  (2024),  The  planning  of  public 
investments  in  EU  Member  States:  long-term  strategy, 
selection  and  budgeting  issues,  DG  ECFIN  Discussion 
Paper no. 213. 

7 

 
 
 
 
 
INNOVATION, BUSINESS ENVIRONMENT AND 
PRODUCTIVITY 

Slovenia’s  labour  productivity  continues 
to steadily converge with that of the rest 
of  the  EU,  reaching  85%  of  the  EU 
average in 2024. The catching-up process is 
expected  to  continue,  with  an  average  annual 
productivity  growth 
rate  of  some  1.3% 
projected  for  2024-2026,  exceeding  the  EU 
average of 0.5%. This section analyses options 
the  productivity  of 
increase 
to 
Slovenia’s  economy, 
labour 
focusing  on 
allocation,  business  dynamism, 
regulation, 
R&D and the sources of capital. 

further 

Narrowing the productivity gap  

premises, 

investments.  Low 

Slovenian  business  investment  remains 
comparatively  low  and  is  focused  on 
investment 
tangible 
overall  is  a  long-standing  problem  in 
Slovenia. Slovenian companies invest 54% of 
their  capital  in  machinery,  above  the  EU 
average  of  48% (15),  highlighting  a  strong 
focus  on  physical  capital.  Additionally,  land, 
business 
infrastructure 
represent  a  relatively  high  proportion  of 
investments.  By  contrast,  areas  such  as 
employee  training, 
ICT,  and  R&D  receive 
relatively  less  investment.  With  just  4.4%  of 
ICT, 
its  GDP 
Slovenia  ranks  17th  in  the  EU (16).  However, 
Slovenia  does 
in  computer 
invest  more 
hardware  than  many  other  EU  countries,  but 
the  uptake  of  digital  technologies  varies 
considerably depending on the size of firms. 

intangibles  and 

invested 

and 

in 

to 

largest 

limited.  The  manufacturing  sector  remains 
the 
Slovenia’s 
contributor 
productivity growth, with an annualised labour 
productivity growth rate of 4.3% over the last 
20 years (17). This sector plays a pivotal role in 
Slovenia’s economy due to its size and robust 
performance.  Other  sectors,  such  as  financial 
and  insurance  activities  and  energy,  also 
exhibited  significant  productivity  growth,  at 
5%  and  4%  annually,  respectively.  However, 
this  has  not  resulted 
in  a  significantly 
increased share in the economy’s value added. 
A shift towards more productive sectors – such 
as  manufacturing, 
services, 
information  and 
communication  –  has 
contributed  less  than  0.1  percentage  points 
annually  to  overall  productivity  growth,  far 
below  what  is  observed  in  other  dynamic 
economies.  Slovenia  seems  to  have  improved 
rules  for  corporate  governance  in  its  many 
largest 
enterprises. 
state-owned 
enterprises  by 
state-owned 
value  are 
operating 
infrastructure,  energy  and 
transport.  Slovenia  also  continues  to maintain 
a  stake  in  companies  in  highly  competitive 
sectors with little rationale for state ownership 
(e.g. tourism) (see Annex 4).  

financial 

The 

in 

business 

dynamism 

Slovenia’s 
has 
weakened but remains comparable to the 
EU  average.  The  churn  rate  (i.e.  the  sum  of 
the firm entry and exit rates) was higher than 
the EU average until 2020, reflecting a strong 
ability  to  reallocate  resources.  However,  since 
2021, the rate of business closures in Slovenia 
has slowed down compared to the EU average.  

Worker  mobility  from  less  productive 
sectors to more productive ones has been 

(15)  2023 European Investment Bank Investment Survey 

(EIBIS). 

(16)  Eurostat (nama_10_a10, nama_10_nfa_fl). 

(17)  European Commission calculations, Eurostat. 

8 

 
 
 
 
Graph 2.1: Structural change: labour 
productivity growth with current vs constant 
sectoral weights 

(1) Actual average labour productivity growth is 
compared to a counterfactual of constant sector weights 
(share in gross value added) at the 2004 level. 
Source: Eurostat (nama_10_a64, nama_10_a64_e, 
nama_10_lp_a21)) 

than 

include 

limits  on 

restrictions 

the  EU  average 

Slovenia  is  one  of  the  most  restrictive 
Member  States  for  trade  in  services. 
Insurance is the most open sector in Slovenia, 
while  engineering  services  are  the  most 
restricted when compared with other countries. 
the 
These 
duration  of  stay  for  service  suppliers  and 
limited  recognition  of  foreign  qualifications 
(see  Annex  4).  Regulatory  restrictiveness  is 
for 
also  higher 
professions  such  as 
lawyers,  real  estate 
agents,  civil  engineers  and  architects.  Overall, 
284 professions are regulated in Slovenia (the 
fourth-highest number in the EU), while the EU 
median is 28 professions. Reducing regulatory 
barriers  in  the  professional  services  sector 
would  make  entry  easier  and  improve  quality 
and prices. In particular, the legal profession is 
more strictly regulated than in other countries. 
Additionally, the fragmented system regulating 
civil  engineers  and  differences  in  regional 
regulations  governing  tourist  guides  may 
further  hinder  market  access  and  affect  both 
national  and  cross-border  service  providers 
(see Annex 4). 

like 

sectors 

single bidders. The share was particularly high 
in 
IT  and  maintenance. 
Approximately  21%  of  all  procurement 
procedures  were  unsuccessful 
in  2024, 
signalling  a  very  tight  procurement  market 
with  a  small  size,  a  high  level  of  public 
investment  and  a  low  number  of  foreign 
bidders.  However,  progress 
in 
several  areas.  The  implementation  of  reforms 
under the RRP is ongoing. In addition, Slovenia 
introduced a public procurement action plan in 
2024, which aims to increase competitiveness 
and  efficiency.  A  2024  OECD  analysis  (18) 
provided recommendations on how to improve 
the  institutional  and  regulatory  framework  to 
foster  competition  and  increase  the  public 
procurement capacity (see Annex 4).  

is  notable 

utilise 

substantially 

Slovenian  companies  have  not  been  able 
to 
alternative 
sources  of  financing  to  further  support 
growth. Companies mainly rely on bank loans 
and  are  rarely  able  to  tap  the  financial 
markets  for  bond  or  equity  funding  (see 
Annex 5).  Like 
in  most  Member  States, 
Slovenian households do not invest enough in 
financial assets and, most importantly, equity. 
capital  markets  are  under-
Slovenia’s 
developed,  as  the  Ljubljana  Stock  Exchange 
capitalisation  is  only  14.6%  of  GDP  (EU 
average: 68%). At the end of 2023, the share 
of  bank  loans  in  all  funding  sources  of  non-
financial  corporations  in  Slovenia  was  similar 
to  the  EU  average,  while  the  share  of  listed 
shares  and  bonds  was  only  a  third  of  the  EU 
average  (7.4%  vs  23.8%).  When  expressed  in 
terms  of  GDP,  the  overall  level  of  business 
funding was only half the EU average (122.7% 
vs  230.3%,  see  Graph  2.3  and  Annex  5).  As 
its  capital  markets  development 
part  of 
strategy  (a  reform  in  Slovenia’s  RRP),  the 
government  has  been  working  on  a  law  on 
individual 
investment  accounts,  which  are 
expected  to  provide  tax-efficient  options  for 
long-term investment for households. 

Despite increased efforts through several 
measures  in  the  national  recovery  and 
in 
resilience  plan 
public  procurement  remains  a  challenge. 
In  2024,  46%  of  contracts  were  awarded  to 

(RRP),  competition 

(18)  OECD, 2025, Maximising the Benefits of Effective 
Competition in Public Procurement in Slovenia. 

9 

00.511.522.5SICZNLEU-27Average yearly labour productivitygrowth (%) over 2004-2023Sectoral gross value added in 2004 as weightsSectoral gross value added in current year as weights 
   
 
Graph 2.2: Business churning 

scoreboard (19),  while  eastern  Slovenia  (92) 
was a moderate innovator.  

Tax rebalancing to promote growth 

(1) Note that there is a structural break in the series in 
2021. Therefore, the data are not directly comparable to 
previous years. 
(2) Business churn is the sum of the birth and death 
rates of all active firms, excluding holding companies. An 
enterprise birth occurs when a firm starts from scratch 
and begins operations, amounting to the creation of a 
combination of production factors with the restriction 
that no other firms are involved in the event. An 
enterprise death is the termination of a firm, amounting 
to the dissolution of a combination of production factors 
with the restriction that no other firms are involved in the 
event. Deaths do not include exits from the population of 
active firms due to mergers, takeovers, break-ups or 
restructuring of a set of firms. 
Source: Eurostat (bd_9bd_sz_cl_r2_ up to 2020, bd_size 
from 2021) 

Graph 2.3: Composition of non-financial 
corporation funding as % of GDP 

(1) Reference period: 2023. 
Source: Eurostat 

Regional differences persist. In 2023, GDP 
per person reached 136% of the EU average in 
the  capital  region  but  was  only  50%  in  the 
(see  Annex  17). Western 
Zasavska  region 
Slovenia (including Ljubljana) was classified as 
innovation 
a 

innovator 

strong 

the 

in 

Slovenia  relies  heavily  on  labour  taxes  – 
including  social  contributions  –  paid  by 
employees.  Slovenia’s  labour  tax  wedge  is 
high  across  different  wage  levels  (see  Annex 
2).  Slovenia’s  tax  wedge  for  families  on 
average wages with children is lower.  The tax 
burden on labour will further increase with the 
new  long-term  care  contribution,  which  is 
needed to address spending in this area. With 
the  aim  of 
increasing  productivity  and 
competitiveness,  the  amendments  to  the 
Personal  Income  Tax  Act  introduced  a  special 
tax  credit  for  new  tax  residents.  High  labour 
taxation  increases  the  cost  of  labour  for 
employers, discourages people to work or look 
for  a  job,  and  makes  shortages  of  workers 
more acute. By contrast, the share of recurrent 
property taxes in total taxes remains very low, 
at  around  one  third  of  the  EU  average  (see 
Annex  2).  Tax  rebalancing  towards  such  more 
growth-friendly tax sources and spending their 
revenue  on  reducing  the  labour  tax  burden 
could  make  it  more  attractive  for  people  to 
work  or 
job  and  support 
competitiveness.  At  the  end  of  2024,  the 
government  prepared  and  submitted 
tax 
amendments  for  public  consultation  in  the 
field  of  the  introduction  of  a  new  real  estate 
tax  and  the  reduction  of  labour  taxation.  To 
strengthen  the  application  of  the  ‘polluter 
pays’  principle,  there  is  also  scope  to  expand 
on 
taxes 
waste 
incineration)  and  to  implement  the  three  not-
yet-implemented types of environmental taxes 
(i.e.  taxes  on  NOx  emissions,  pesticides  and 
fertilisers).  

(including 

disposal 

for  a 

look 

(19)  European Commission: Directorate-General for Research 
and Innovation, Hollanders, H. and Es-Sadki, N., Regional 
Innovation Scoreboard 2023, Publications Office of the 
European Union, 
2023, https://data.europa.eu/doi/10.2777/70412. 

10 

0.02.55.07.510.012.515.017.520.0SIEU-27SIEU-27SIEU-27SIEU-27SIEU-2720182019202020212022% of active enterprisesBirth rateDeath rate050100150200250SIEU% of GDPLoansTrade credit and advancesBondsListed sharesUnlisted sharesOther equity 
   
 
  
 
innovation  expenditure,  which  is  particularly 
relevant  to  bringing  innovation  to  the  market, 
but which receives less public support. Possible 
regulatory  problems  exist  as  well:  the  age 
structure  of  Slovenian  companies  is  not  very 
well suited for high-growth companies; current 
rules  make  adding  new  capital  injections  and 
records 
the 
shareholders 
of 
Additionally, 
cumbersome. 
employee  stock  options  does  not  meet  the 
expectations  of  high-growth 
companies, 
limiting the effectiveness of this tool to recruit 
and retain talent in the companies.  

respective 

taxation 

to 

Public  investment  in  R&D  remains  low 
compared  to  other  EU  countries.  Public 
R&D  intensity  (0.64%  of  GDP)  remains  below 
the EU average (0.72%) and is still well below 
Slovenia’s  ambitious  1.25%  target  for  2030 
(see  Annex  3).  The  Act  on 
research, 
development  and  innovation  activities,  under 
the  RRP,  and  the  Slovenian  scientific  research 
and  innovation  strategy  for  2030  provide  a 
good  basis  for  such  investment.  This  could 
allow  Slovenia  to  fully  exploit  its  scientific 
potential  and  increase  its  attractiveness  as  a 
location  for  R&D  intensive  sectors,  which  are 
crucial  for  Slovenia’s  competitiveness.  The 
selection  of  Slovenia  as  host  for  an  artificial 
intelligence (AI) factory should raise Slovenia’s 
attractiveness  internationally  to  researchers 
and  companies  working  intensively  with  AI. 
This  project,  estimated  at  EUR 150 million,  is 
expected to foster  AI-driven innovation across 
various  sectors,  engaging  with 
industry 
to  provide  businesses  with  AI-
partners 
powered  solutions,  technical  support,  and 
infrastructure access. 

Closing the innovation gap 

Innovation 

Slovenia  remains  a  ‘moderate  innovator’ 
and  lags  behind  the  EU  in  innovation 
to 
performance.  According 
the  2024 
Scoreboard (20), 
European 
innovation  performance  –  a 
Slovenia’s 
measure  based  on  a  total  of  32  indicators  – 
remained  slightly  below  the  EU  average  in 
2024  (91%)  but  improved  less  than  the  EU 
average  between  2017  and  2024.  Slovenia  is 
performing particularly  well relative to the EU 
average when it comes to high-skilled workers 
and small to medium-sized enterprises (SMEs) 
this 
introducing  product 
indicator, 
an 
Slovenia 
underperformer  into  one  of  the  strongest 
performers.  However,  the  country  still  faces 
challenges  in  various  areas,  such  as  venture 
capital 
non-R&D 
innovation  expenditure  showed  the  worst 
performance  of  all  32 indicators  in  2024  and 
is  also  the  indicator  with  the  steepest  decline 
since  2017.  Slovenia  also underperforms  with 
regard to R&D expenditure in the public sector 
and 
innovation  expenditure  per  person 
employed.  

innovations.  On 
from 

expenditure. 

Similarly, 

turned 

The  low  share  of  individuals  with  basic 
digital  or  ICT  specialist  skills  weighs  in 
particular  on  SMEs.  The  country  ranks 
among  the  top  performers  in the  EU  in  terms 
of  digital  intensity  in  businesses  with  250 
employees  or  more,  where  almost  all 
employees have at least a basic level of digital 
intensity.  By  contrast,  in  SMEs,  only  68%  of 
employees have at least a basic level of digital 
skills  (see  Annex  3).  This  may  reflect  limited 
possibilities 
to  adopt  digital 
technologies  due  to  a  lack  of  sufficiently 
skilled staff.  

for  SMEs 

recent 

improvements, 

Despite 
the 
availability  of  venture  capital  remains 
very  low.  Venture  capital  amounts  to  only 
0.005%  of  GDP  in  Slovenia,  which  is  the 
second  lowest  in  the  EU  (see  Annex  5).  This 
might  be  behind  the  low  level  of  non-R&D 

(20)  European Innovation Scoreboard - Slovenia. 

11 

 
 
DECARBONISATION, ENERGY AFFORDABILITY AND 
SUSTAINABILITY 

renewable 

deployment 
navigate 
effectively. The issue is further exacerbated by 
high levels of opposition from locals.  

energy 

Investments  under 

Insufficient  grid  capacity  represents  an 
increasing obstacle for the integration of 
new  renewable  energy  installations.  With 
over 20% of grid connection requests rejected 
in 2024, Slovenia faces challenges to connect 
new renewable energy installations, especially 
small-scale  ones. 
the 
recovery  and 
(RRP)  and 
the 
REPowerEU 
medium- and low-voltage grids, as well as the 
construction  of  new  transformer  stations. 
Completing  these  investments  is  expected  to 
help alleviate the issue. Deployment of stand-
alone  and  co-located  storage  installations  is 
increasingly  important  for  ensuring  system 
flexibility  and  facilitating  the  integration  of 
renewables.   

the  upgrade  of 

resilience  plan 

include 

in 

improvement,  especially 

Energy 
consumption  has  decreased, 
especially in the industrial sector, with a 
decrease  of  9.1% 
final  energy 
consumption  in  2023.  However,  there  is 
room  for 
in  the 
service sector, which slightly increased its final 
energy  consumption  by  0.1%  in  2023  (see 
Annex  8).  Energy  efficiency  renovation  of 
buildings  has  continued  through  the  national 
financing  framework  composed  mainly  of 
grants  and  soft  loans,  as  well  as  through  the 
implementation  of  different  EU 
funds, 
including  the  Recovery  and  Resilience  Facility. 
However, Slovenia needs to step up its efforts, 
particularly  to  reach  the  long-term  renovation 
strategy 
the  energy 
consumption  of  buildings  by  17%  by  2030 
(compared to 2020). 

reduce 

target 

to 

Accelerating the green transition 
to bolster competitiveness and 
energy affordability 

Reliance  on  fossil  fuels  and  limited  non-
fossil  flexibility  pose  challenges  to 
economic  competitiveness  and  energy 
affordability.  In  2024,  wholesale  electricity 
prices in Slovenia were the 10th highest in the 
EU,  averaging  91 EUR/MWh.  Slovenia  remains 
structurally  dependent  on  coal  and  natural 
gas,  which  continue  to  account  for  nearly  a 
quarter  of  its  electricity  mix  (see  Annex  8). 
Exposure  to  volatile  fossil  fuel  prices  has 
impacted wholesale electricity prices, affecting 
both  businesses  and  households.  While 
wholesale  electricity  prices  initially  declined 
amid  falling  natural  gas  costs,  they  surged 
during  summer  and  winter,  diverging  from 
central-western 
This 
volatility  was  partially  driven  by  prolonged 
summer heatwaves, which increased electricity 
consumption, 
hydropower 
flexibility,  limiting  the  available  supply.  As  a 
result,  natural  gas-  and  coal-fired  electricity 
generation had to be ramped up (see Annex 8). 

European  markets. 

reduced 

and 

The  deployment  of  solar  photovoltaics 
(PV)  has  slowed  down,  while  wind 
installations remain stagnant. In 2024, the 
total  renewable  energy  capacity  increased  by 
nearly 13% year-on-year, which is lower than 
in 2023 (22%). A total of 278 MW of solar PV 
were  deployed 
the 
cumulative  capacity  to  1 309 MW.  No  new 
wind  capacity  has  been  added  in  Slovenia  for 
over a decade, with the capacity remaining at 
3 MW  (see  Annex  8).  The  permitting  process 
for  wind  installations  remains  complex  and 
lengthy,  with  no  designated  areas  for  fast-
track  approval.  Local  municipalities  often  lack 
the  technical  expertise  and  resources  to 

in  2024,  bringing 

12 

 
 
Increasing the uptake of 
sustainable modes of transport 

The  uptake  of  sustainable  transport  is 
still lagging behind. The high dependence on 
private  cars  and  slowed  down  uptake  of 
transport  have  a 
sustainable  modes  of 
negative  impact  on  Slovenia’s  ability  to  help 
achieve the EU target of reducing final energy 
consumption  by  11.7%  by  2030.  Between 
2005  and  2023,  greenhouse  gas  emissions 
from  road  transport  increased  by  20%  in 
Slovenia,  while  they  decreased  by  5%  overall 
in  the  EU  (see  Annex  7).  The  share  of 
electricity  in  final  energy  consumption  in  the 
transport  sector  remains  negligible  at  1.3% 
(see  Annex  8).  Many 
large  railway  and 
e-mobility  investments  under  the  RRP  are  in 
progress, but there is still room to increase the 
uptake  of  public  transport  by  improving  the 
frequency, 
and 
availability of national and local public rail and 
bus  transport,  particularly  with  soft  measures 
such as better coordination of timetables with 
urban and municipal transport.  

accessibility 

reliability, 

Strengthening climate and water 
resilience, sustainable water 
management, environmental 
protection and circularity 

Slovenia  is  highly  vulnerable  to  climate 
risks,  particularly  floods,  which  have  a 
negative  impact  on  the  economy  and 
society.  Slovenia  is  frequently  exposed  to 
climate-related risks and has suffered multiple 
extreme  weather  events in  recent years (such 
as  wildfires  in  2022  and  windstorms  with 
heavy  floods,  triggering  landslides,  in  2023). 
The economic loss per person, in particular due 
to  floods,  is  the  highest  in  the  EU  (see 
Annex 9). Despite efforts to strengthen climate 
adaptation 
action, 
challenges remain, in particular in terms of the 
implementation  of  flood  protection  measures, 
which  are  continuously  delayed,  and  the 
persisting  climate  change-related  institutional 
weaknesses,  in  particular  linked  to  the  still 

preparedness 

and 

13 

in 

capacities 

in  green 

environmental 
lacking 
governance and coordination among all levels 
of  government  and  administration.  Scaling  up 
investments 
infrastructure  and 
nature-based  solutions  plays  a  crucial  role  in 
mitigating 
floods  while 
impact  of 
protecting nature. Improving sustainable water 
management  could  also  further  reduce  the 
impacts  of  floods  in  the  event  of  extreme 
precipitation.   

the 

in 

of 

its 

covered 

territory 

stability 

economic 

Sustainable  water  use  and  nature 
protection and restoration are crucial for 
the 
and 
competitiveness  of  Slovenia.  Slovenia  has 
a  biodiversity-rich  natural  environment,  with 
by 
41% 
protected land area  in  2022.  Key  economic 
sectors (such as agriculture, the food industry, 
tourism, construction and pharmaceuticals) are 
highly  dependent  on  ecosystem  services  and 
Slovenia’s  natural  resources  (see  Annex  9). 
Water  resources  are  under  growing  pressure, 
and  despite  ongoing  EU-funded  investments, 
substantial 
for  water 
investment  needs 
protection  and  water  management  remain, 
particularly 
the  areas  of  wastewater 
collection and treatment. The recently adopted 
Act  on  drinking  water  supply  and  collection 
and treatment of urban wastewater, supported 
by  the  RRP,  aims  to  ensure  the  long-term 
infrastructure 
sustainability 
investment financing. However, further efforts 
are 
to  address  ongoing 
sustainability  challenges.  Despite  extensive 
protection  efforts,  the  state  of  nature  and 
ecosystems 
in 
Slovenia,  which  further  weakens  the  country’s 
climate resilience and highlights the financing 
gap.  However,  the  adoption  of  the  National 
Biodiversity  Strategy  2030  and  enhanced 
implementation  of  EU-funded 
restoration 
projects  (such  as  LIFE  and  RRP  nature-based 
solutions)  represent  a  positive  step  toward 
addressing this trend. 

to  deteriorate 

still  needed 

continues 

water 

of 

Slovenia  is  also  highly  dependent  on 
imports  of  raw  materials  from  a  limited 
import 
number  of  sources,  with 
concentration  higher 
the  EU 
In  addition,  Slovenia’s  circular 
average. 
material  use  rate  has  stagnated,  remaining 
below the EU average, with Slovenia’s resource 

than 

its 

 
Implementation 

productivity  being  considerably  below  the 
average. 
of  measures 
supporting  higher  circular  use  of  materials 
could help reduce dependence on imports, and 
address  challenges  regarding  supply  chain 
risks,  environmental  degradation,  and  social 
concerns (see Annex 7).   

14 

 
SKILLS, QUALITY JOBS AND SOCIAL FAIRNESS 

The  2022  OECD  PISA  survey  on  pupils’  skills 
highlighted a worrying trend: around a quarter 
of  15-year-olds  did  not  achieve the minimum 
level  of  proficiency 
in  mathematics  and 
reading. Deficiencies are far more pronounced 
among  students  with  a  poor  socio-economic 
background. Widespread shortages of teachers 
contributed  to  the  decline  in  performance,  as 
schools  fail  to  organise  lessons.  In  2022, 
approximately  42%  of  students  attended 
schools  where  instruction  was  compromised 
by  a  lack  of  teaching  staff.  Slovenia  has 
already  taken  measures,  including  simplifying 
the  procedure  for  recruiting  teachers  and 
introducing  a  new  salary  law,  but  further 
efforts 
the 
attractiveness of the profession, particularly in 
science, 
and 
mathematics (STEM) subjects.  

engineering 

technology, 

improve 

needed 

are 

to 

relocate  as  well  as 

Housing  availability  and  prices  also 
impact  negatively on productivity, labour 
mobility,  and  attractiveness  to  foreign 
workers.  Lack  of  housing  in  areas  where 
employment  is  concentrated  is  becoming  a 
problem,  particularly  for  young  people.  House 
prices  have  continued  to  rise  relative  to 
incomes,  which  affects  the  ability  of  workers 
to  work  more 
to 
productively  and  makes  it  more  difficult  to 
attract  foreign  workers.  Low  availability  of 
housing  in  urban  areas  increases  commuting 
emissions. 
time, 
Reforms  in  the  recovery  and  resilience  plan 
(RRP)  aim  to  ease  access  to  funding  for  local 
communities  and  boost  investments  in  public 
rental  housing.  These  reforms  are  likely  to 
provide  some  relief,  but  more  measures  are 
needed to boost investment (see Annex 11). 

exacerbating 

transport 

Shortages of workers constrain 
growth  

in 

is 

Slovenia’s 
facing 
job  market 
significant  worker  and  skills  shortages. 
Despite  a  low  unemployment  rate  of  3.7%  in 
2024,  the  challenge  of  over-qualification 
persists.  The  skills  available  do  not  meet  the 
demand  in  the  job  market.  In  2024,  job 
vacancy rates in key sectors such as industry, 
construction  and  services  remained  high, 
although  these  decreased  compared  to  the 
previous year. In particular, high vacancy rates 
the  construction  and 
were  registered 
services 
sectors,  at  4.9%  and  2.9%, 
respectively  (EU  average:  3.1%  and  2.7%). 
Almost half of all employers faced difficulties 
in  hiring  suitable  workers,  including  among 
vocationally  and  post-secondary-educated 
individuals,  undermining  the  productivity  of 
firms  and  their  ability  to 
ICT 
professionals  were  particularly  scarce,  with  a 
notable  shortfall  in  the  number  of  new  ICT 
graduates,  which  is  insufficient  to  meet  the 
needs  of  the  digital  transformation  in  the 
corporate  sector  (see  Annex  12).  Shortages 
also  affect  occupations  needed  for  the  green 
economy.  

innovate. 

impact 

the 
Shortages  of  workers 
healthcare,  social  and  long-term  care 
sectors  significantly.  In  particular,  doctors, 
nurses,  caregivers  and  social  workers  are  in 
short supply. Low wages and  difficult working 
conditions  cause  high  turnover  rates.  The 
workforce  in  these  areas  is  also  significantly 
older than in other sectors. Further investment 
in buildings and infrastructure in these sectors 
might  be  inefficient  if  no  adequate  staffing 
can be achieved.  

Unavailability  of  teachers  is  a  specific 
challenge  to  raise  the  basic  skills  level. 

15 

 
 
Job market participation and adult 
skills could be further improved 

The  low  share  of  people  from  vulnerable 
groups  who  are  working  or  looking  for  a 
job  is  a  pressing  issue.  In  2024,  Slovenia 
had  one  of  the  lowest  employment  rates  of 
older  workers  in  the  EU.  Low-skilled  older 
adults  faced  a  high  long-term  unemployment 
rate,  further  highlighting  the  challenges  they 
encounter  in  securing  employment.  Reforms 
envisaged 
in  the  RRP  will  address  this 
challenge by increasing the retirement age and 
rationalising 
before 
retirement. These reforms are also expected to 
help reach the 2030 national employment rate 
target  of  79.5%.  Although  employment  rates 
for low-qualified adults have been on the rise 
since  2020,  they  are  still  below  the  EU 
average 
(see  Annex  8).  Additionally,  the 
integration  of  non-EU  nationals  remains  a 
challenge. In the short term, legal immigration 
could alleviate the shortages of workers in key 
sectors.   

available 

benefits 

Low-wage and inactivity traps constitute 
hurdles  to  job  market  participation.  For 
instance,  transitioning  from  inactivity  to  work 
results  in  substantial  loss  of  additional  net 
income  due  to  implicit  taxation,  which  is 
significantly  higher  than  the  EU  average.  This 
deters  especially  single  parents  and  second 
earners,  often  women,  from  seeking  work  or 
increasing  working  hours.  Such  traps  act  as 
disincentives,  primarily  affecting  those  with 
lower education levels, who are more likely to 
be employed in low-paying jobs.  

the 

workforce 

While 
lacks 
labour-market-relevant  skills,  including 
in digital and STEM fields, participation in 
adult  learning  has  declined.  Adult  learning 
participation  declined  sharply  from  40.3%  in 
2016 to 26.5% in 2022, well below Slovenia’s 
2030  target  of  60%.  The  challenges  were 
most  pronounced  among  low-qualified,  older 
individuals,  those  with  a  migrant  background, 
and  non-working  people.  Conversely,  better-
trained individuals participate more frequently 
in 
learning  schemes,  highlighting 
disparities  based  on  educational  attainment. 

lifelong 

The lack of digital skills among the population 
presents  a  barrier  to  entering  more  skilled 
employment  sectors.  This 
is  a  challenge 
for the entire adult population, but in particular 
for  unemployed  people  and  those  lacking 
access to digital tools. Special attention should 
be paid to green skills, as shortages of workers 
are  prevalent  across  many  occupations 
skills  or  expertise 
specialised 
requiring 
essential for the green transition.  

The pension reform is in the final 
steps before the adoption 

reform 

The government has put forward pension 
the 
reform 
legislation  dealing  with 
adequacy  and  sustainability  of 
the 
is  very 
pension  system.  The 
important, as during 2022-2070, the working-
age  population  (20-64)  is  projected  to  fall  by 
16%,  and  the  proportion  of  those  with  the 
highest  activity  rates  (35-49)  is  expected  to 
experience the steepest drop (28%) (see Annex 
10). The reform, part of the Slovenian RRP, will 
gradually  raise  –  by  three  months  every  year 
between 2028 and 2035 – the retirement age 
from  60  to  62  for  those  with  40  years  of 
service and from 65 to 67 years for everyone 
else, and revise the pension indexation method 
(shifting the emphasis from wage increases to 
inflation).  Pension  adequacy  and transparency 
are  addressed  by  increasing  the  accrual  rate 
for  40  years  of  contributions  from  63.5%  to 
70% by 2035 and by implementing measures 
directed towards the most vulnerable retirees, 
essentially 
receiving  disability  or 
survivor’s pensions. Based on this proposal, the 
survivor’s pensions will be increased gradually 
from  70%  to  80%  of  the  pension  of  the 
deceased.  In  addition,  the  reform  will  give 
broader  options  of  vocational  rehabilitation  in 
order  to  help  workers  with  a  temporary  or 
permanent lower capacity to work to maintain 
or find employment. 

those 

The  pension  reform  will  broaden  the 
investment 
in  supplementary  pension 
schemes.The reform also .requires employers 
to  create  a  pension  plan  for  their  employees 
but does not require employers to finance the 

16 

 
plan.  This  could  lead  to  faster  growth  of  the 
pension  funds’  assets.  The  restrictions  on  the 
investment of pension assets are high and the 
rates of return low – in 2023, Slovenia was at 
the  lower  end  of  the  OECD  countries  in  this 
regard (21). 

Reforms of healthcare and long-
term care are progressing 

Slovenia  is  reforming  the  long-term  care 
system comprehensively. The reform is one 
of  the  key  measures  under  the  RRP  and 
includes  the  adoption  of  a  new  law  on  long-
term care (LTC Act) and related implementing 
acts.  The  new  LTC  Act  entered  into  force  in 
2023.  The  right  to  family  care  has  been 
applicable  since  January  2024.  During  the 
course of 2025, the last aspects of the LTC Act 
will become applicable. As of 1 July 2025, the 
right  to  care  at  home  for  eligible  users  will 
the  mandatory 
take  effect,  along  with 
contribution  to  the  new  LTC  insurance  for 
employers,  employees  and  pensioners.  From 
1 December 2025,  the  last  two  aspects,  the 
right  to  care  in  an  institution  and  to  cash 
benefits, will become effective.  

to 

work 

practice. 

adjustments 

Many challenges remain to make the LTC 
system 
The 
in 
implementation  of  the  entirely  new  LTC 
system  is  a  challenging  process  with  many 
be 
administrative 
implemented,  such  as  setting  up  one-stop 
shops  for  LTC  users,  putting  in  place  the 
collection  procedure 
insurance 
contributions,  authorising  LTC  providers,  and 
implementing  a quality monitoring system. As 
the system matures, the challenge would be to 
offer  different  options  for  care,  taking  into 
account  the  special  needs  of  different  user 
groups while ensuring that the system remains 
financially viable (22).  

the 

for 

(21)  Pension Markets in Focus 2024, OECD (2024). 

(22)  In some cases, LTC providers are not able to find 
sufficient staff to open their newly built premises. 

17 

control 

is  preparing  a  healthcare 
Slovenia 
reform,  the  final  parts  of  which  are 
expected to be adopted in  the autumn of 
2025.  The  reform,  which  is  a  centrepiece  of 
Slovenia’s RRP, comprises amendments to the 
Healthcare  and  Health  Insurance  Act  and  to 
the  Health  Services  Act.  It  also  comprises  a 
new  Act  on  health  quality  that  aims  to  set 
quality requirements in the healthcare system 
and to create an independent body to monitor 
and 
of  healthcare 
compliance 
providers.  The  amendments  to  the  Health 
Services  Act  were  adopted  by  parliament  in 
March  2025.  They  aim  to 
increase  the 
efficiency  and  transparency  of  the  work  of 
public  health  institutions  by  regulating  the 
relationship  between  healthcare  providers 
operating  in  a  public  network  and  those 
operating  outside 
the  network,  defining 
healthcare  providers  and  the  conditions  for 
obtaining  authorisation  to  practise  healthcare, 
and 
and 
health 
commercial 
the 
institutions. 
Healthcare  and  Health 
Insurance  Act  are 
expected  to  increase  the  efficiency  of  the 
healthcare system in Slovenia and to improve 
its  financial  stability  by  introducing  different 
sources  of 
the 
catalogue  of  items  financed  via  the  health 
insurance.  It  is  expected  to  be  adopted  by 
parliament in the autumn of 2025.  

activity 
The 

revenue  and 

public 
in 

amendments 

demarcating 

reviewing 

service 

public 

to 

and 

gains 

could  help 

expenditure 
Efficiency 
confinements 
safeguard 
financial  stability  while  ensuring  access 
to  healthcare.  Limited  access  to  healthcare, 
mainly  caused  by  shortages  of  healthcare 
workers,  remains  one  of  the  main  challenges 
in  Slovenia’s  healthcare  system.  In  2024,  the 
proportion  of 
the  Slovenian  population 
reporting  unmet  needs  for  medical  care  was 
higher  than  the  EU  average  (3.4%  vs  2.5%). 
Long  waiting  times  –  mainly  for  specialists, 
elective  surgery,  primary  care  physicians  and 
emergency  care  –  are  seen  as  the  main 
the 
the 
reason.  With 
complementary  voluntary  health 
insurance 
held  by  the  vast  majority  of  Slovenes  into  a 
mandatory contribution to the statutory health 
insurance  is  expected  to  keep  the  share  of 
private  health  expenditure  below  the  EU 
average.  At  the  same  time,  it  is  expected  to 

transformation  of 

 
 
increase  the  share  of  publicly  funded  health 
expenditure.  Investments  in  its  digitalisation, 
partly financed by EU funds, are also expected 
to  increase  the  efficiency  and  accessibility  of 
healthcare (see Annex 14). 

Slovenia  makes  efforts  to  address  the 
country’s  relatively  high  preventable 
mortality.  The  high  rate  of  preventable 
mortality  is  linked  to  behavioural  risk  factors, 
in  particular  poor  diet  and  other  unhealthy 
habits.  Efforts  to  tackle  preventable  mortality 
include  programmes  for  early  detection  of 
cancer,  a  national  nutrition  and  physical 
activity  strategy  to  fight  obesity,  health 
promotion  initiatives,  and  the  stepping-up  of 
primary  care,  especially  for  chronic  illnesses 
and vulnerable people (see Annex 14). 

18 

 
 
KEY FINDINGS 

To  boost  competitiveness,  sustainability  and 
social fairness, Slovenia would benefit from:  

•  accelerating  the  implementation  of 
the  recovery  and  resilience  plan, 
including  the  REPowerEU  chapter,  swiftly 
implementing  cohesion  policy,  taking 
advantage  of  the  opportunities  under  the 
mid-term  review  and  making  optimal  use 
of EU instruments, including InvestEU and 
STEP, to improve competitiveness; 

fiscal 

sustainability 

•  pursuing  policies  that  support  long-
term 
by: 
(i) rebalancing tax  revenues towards more 
growth-friendly  and  sustainable  sources; 
and  (ii)  ensuring  the  sustainability  of  the 
social protection system beyond measures 
envisaged  in  the  recovery  and  resilience 
plan;  

• 

• 

improving 
finances, 
spending reviews; 

the  quality  of  public 
implementing 

including  by 

increasing 
further 
investments 
deepen  the  capital  stock  of  the  economy, 
especially investments in non-tangibles;  

to 

adopt 

•  supporting  small  to  medium-sized 
enterprises 
digital 
to 
technologies  and  to  continue  bringing 
innovative  products  to  the  market 
with  a  particular  focus  on  the  financing 
needs 
the 
commercialisation  of  a  new  product  or 
service; 

the  critical  phase  of 

in 

• 

• 

improving  the  legislative  framework 
to  better  match  the  expectations  of  high-
growth businesses;  

legislation 
implementing 
fully  and  rapidly  to  provide  a  good 
basis  for  public  R&D  investment  to 

relevant 

19 

enable the full exploitation of the scientific 
increase  Slovenia’s 
potential  and 
attractiveness  as  a 
location  for  R&D 
intensive sectors; 

to 

• 

• 

further  reducing  the  administrative 
burden and easing business regulation by 
relaxing restrictions in certain services and 
regulated 
reducing 
professions,  and 
barriers to service providers from other EU 
countries;  

further  developing  financial  markets 
by 
the  capital  markets 
implementing 
development strategy; 

•  making 

further 

progress 

in 
decarbonising  by  streamlining  the 
permitting  process  for  renewables, 
particularly  wind  installations,  with  the 
creation  of  designated  priority  areas  to 
boost  deployment 
in  order  to  reduce 
energy prices by reducing reliance on fossil 
fuels  and  minimising  exposure  to  volatile 
natural gas prices; 

•  making 

further 

progress 
by  upgrading 

in 
the 
decarbonising 
electricity  grid 
in 
particular  low-voltage  infrastructure,  to 
facilitate  the  integration  of  renewable 
energy installations; 

infrastructure, 

• 

further supporting climate adaptation 
and  water  resilience  measures,  while 
ensuring  sustainable  water  management 
and nature protection and restoration; 

•  addressing 

and 

skills 
worker 
shortages,  including  by:  (i)  improving  the 
attractiveness of and working conditions in 
affected 
increasing 
participation  of  under-represented  groups; 
and (iii) further integrating non-EU workers 
into the job market and society; 

sectors; 

(ii) 

 
 
•  ensuring 

that 

pupils 

teacher 

have 
strengthened  basic  skills,  including  by 
and 
addressing 
improving 
the 
profession, 
attractiveness 
technology, 
particularly 
in 
engineering  and  mathematics 
(STEM) 
subjects; 

teacher  education  and 

the 
science, 

shortages 

of 

•  boosting 

and 
(i) 

skills 
by: 

labour 
productivity, 
increasing 
participation  in  adult  learning,  including 
reskilling;  and 
skilling,  upskilling  and 
(ii) fostering  digital  and  green  skills, 
including 
the 
implementation  of  measures  under  the 
cohesion  policy  programme,  the  recovery 
and  resilience  plan  and  other  national 
programmes; 

accelerating 

by 

• 

implementing  the  major  structural 
reforms of long-term care, healthcare 
and pensions fully and swiftly in 2025 as 
well  as  improving  working  conditions  and 
addressing  staff  shortages  prevalent  in 
healthcare and long-term care; 

•  ensuring  that  future  retirees  joining 
the  voluntary  pension  pillar  have 
access  to  the  full  spectrum  of 
investment  options,  including  low-cost 
index  fund  options,  and  relaxing  the 
restrictions  on  the  investment  policies  of 
pension  funds  in  general  while  explaining 
the risks to the insured.  

20 

 
 
ANNEXES 

 
 
 
 
LIST OF ANNEXES 

Fiscal 

A1.  Fiscal surveillance and debt sustainability 

A2.  Taxation 

Productivity 

A3. 

Innovation to business 

A4.  Making business easier 

A5.  Capital markets, financial stability and access to finance 

A6.  Effective institutional framework 

Sustainability 

A7.  Clean industry and climate mitigation 

A8.  Affordable energy transition 

A9.  Climate adaptation, preparedness and environment 

Fairness 

A10.  Labour market 

A11.  Social policies 

A12.  Education and skills 

A13.  Social Scoreboard 

A14.  Health and health systems 

Horizontal 

A15.  Sustainable development goals 

A16.  CSR progress and EU funds implementation 

A17.  Competitive regions 

LIST OF TABLES 

General government balance and debt 
Net expenditure growth 
Net expenditure (outturn and forecasts), annual and cumulated deviations vis-à-vis the recommendation 
Defence expenditure and the national escape clause 

A1.1. 
A1.2. 
A1.3. 
A1.4. 
A1.5.  Macroeconomic developments and forecasts 
A1.6. 
A1.7. 
A1.8. 
A1.9. 

General government budgetary position 
Debt developments 
RRF – Grants 
RRF - Loans 

23 

26 

26 

33 

36 

36 

41 

47 

54 

59 

59 

65 

72 

77 

77 

81 

86 

91 

92 

95 

95 

98 

105 

27 
27 
28 
28 
28 
29 
29 
30 
30 

 
 
 
A1.10.  Projected change in age-related expenditure in 2024-2040 and 2024-2070 
A1.11.  Fiscal Governance Database Indicators 
A2.1. 
Taxation indicators 
A3.1. 
Key innovation indicators 
A4.1.  Making Business Easier: indicators. 
A5.1. 
A6.1. 
A6.2. 
A7.1. 
A8.1. 
A9.1. 
A13.1.  Social Scoreboard for Slovenia 
A14.1.  Key health indicators 
A16.1.  Selected EU funds with adopted allocations - summary data (million EUR) 
A16.2.  Summary table on 2019-2024 CSRs 
A17.1.  Selection of indicators at regional level in Slovenia 

Financial indicators 
Slovenia. Selected indicators on administrative burden reduction and simplification 
Digital Decade targets monitored by the Digital Economy and Society Index 
Key clean industry and climate mitigation indicators: Slovenia 
Key Energy Indicators 
Key indicators tracking progress on climate adaptation, resilience and environment 

LIST OF GRAPHS 

Tax revenue shares in 2023 
Tax wedge for single and second earners, % of total labour costs, 2024 
R&D intensity (GERD as a percentage of GDP), 2013-2023 
Venture capital as a percentage of GDP, 2023 

A2.1. 
A2.2. 
A3.1. 
A3.2. 
A4.1.  Making Business Easier: selected indicators. 
A5.1. 
Net savings-investment balance in Slovenia 
A5.2. 
International investment position of Slovenia 
A5.3. 
Capital markets and financial intermediaries in Slovenia 
A5.4. 
Composition of NFC funding as % of GDP 
A5.5. 
Composition of household financial assets per capita and as % of GDP 
A6.1. 
Trust in justice, regional / local authorities and in government 
A6.2. 
Indicators of Regulatory Policy and Governance (iREG) 
A6.3. 
Participation rate of 25-64 year olds in adult learning (%) by occupation 
A7.1. 
GHG emission intensity of manu-facturing and energy-intensive sectors, 2022 
A7.2. 
Greenhouse gas emissions in the effort sharing sectors, 2005 and 2023 
A8.1. 
Retail energy price components for household and non-household consumers, 2024 
A8.2.  Monthly average day-ahead wholesale electricity prices and European benchmark natural gas prices (Dutch TTF) 
A8.3. 
A9.1. 
A9.2. 
A10.1.  Key labour market indicators 
A10.2.  Low-wage and inactivity trap 
A11.1.  AROPE rate and its components 
A11.2.  Housing deprivation 
A12.1.  Underachievement in basic skills 
A12.2.  Future employment needs (2022-2035) by occupation and education level 
A14.1.  Life expectancy at birth, years 
A14.2.  Treatable mortality 
A15.1.  Progress towards the SDGs in Slovenia 
A16.1.  Distribution of RRF funding in Slovenia by policy field 
A16.2.  Distribution of cohesion policy funding across policy objectives in Slovenia 
A17.1.  Labour productivity per hour 

Slovenia's installed renewable capacity (left) and electricity generation mix (right) 
Direct dependency(1) on ecosystem services(2) of the gross value added generated by economic sector in 2022 
Investment needs and gaps in EUR million, in 2022 constant prices 

LIST OF MAPS 

A17.1.  House prices relative to income, 2019 
A17.2.  Territories most affected by energy transition 

24 

31 
32 
33 
40 
46 
53 
55 
56 
64 
71 
76 
91 
93 
101 
102 
106 

33 
34 
36 
39 
42 
47 
47 
48 
50 
51 
54 
55 
57 
61 
62 
65 
66 
68 
74 
75 
77 
79 
81 
83 
86 
88 
92 
92 
95 
99 
99 
105 

106 
107 

 
 
 
A17.3.  Regional impact of 2023 floods 

107 

25 

 
 
 
 
FISCAL 
ANNEX 1: FISCAL SURVEILLANCE AND DEBT SUSTAINABILITY 

This  Annex  contains  a  series  of  tables  relevant  for  the  assessment  of  the  fiscal  situation  in  Slovenia, 
including  how  Slovenia  is  responding  to  Council  recommendations  issued  under  the  reformed  Economic 
Governance Framework. 

The  reformed  framework,  which  entered  into  force  on  30  April  2024 (23),  aims  to  strengthen  debt 
sustainability  and  promote  sustainable  and  inclusive  growth  through  growth-enhancing  reforms  and 
priority investments. The medium-term fiscal-structural plans (hereinafter, MTPs or plans) constitute the 
cornerstone  of  the  framework,  setting  the  budgetary  commitment  of  Member  States  over  the  medium 
term. The latter is defined in terms of net expenditure growth, which is the single operational indicator for 
fiscal surveillance.  

Slovenia submitted its plan on 15 October 2024. The plan covers the period until 2028, presenting a fiscal 
adjustment  over  four  years.  On  21  January  2025,  the  Council  adopted  the  Recommendation  endorsing 
Slovenia’s plan (24). 

The assessment of the implementation of the Council Recommendation endorsing the Slovenia’s plan is 
carried out on the basis of outturn data from Eurostat, the Commission’s Spring 2025 Forecast and taking 
into  account  the  Annual  Progress  Report  (APR)  that  Slovenia  submitted  on  28  April  2025.  Furthermore, 
given  Slovenia’s  request  to  activate  the  National  Escape  Clause (25)  in  accordance  with  the  Commission 
Communication  of  19  March  2025 (26),  the  assessment  also  considers,  as  appropriate,  the  projected 
increase in defence expenditure based on the Commission Spring 2025 Forecast.  

The Annex is organised as follows. First, developments in government deficit and debt are presented 
based  on  the  figures  reported  in  Table  A1.1.  Then,  the  assessment  of  the  implementation  of  the 
Council  Recommendation  endorsing  the  plan  follows,  based  on  the  relevant  figures  presented  in 
Tables A1.2 to A1.9, including data on defence expenditure. 

The Annex also provides information on the cost of ageing and the national fiscal framework. Fiscal 
sustainability risks are discussed in the Debt Sustainability Monitor 2024 (27). 

Developments in government deficit and debt  

Slovenia’s government deficit amounted to 0.9% of GDP in 2024. Based on the Commission’s Spring 2025 
Forecast,  it  is  projected  to  increase  to  1.3%  of  GDP  in  2025.  The  difference  between  the  general 
government balance projected by Commission and Slovenia is mostly due to  a lower projection of gross 
fixed capital formation as well as higher projections of revenue from taxes on production and imports and 
from social  contributions by  the Commission. The government debt-to-GDP ratio amounted to 67.0% at 
the end of 2024 and, according to the Commission, it is projected to decrease to 65.5% end-2025. 

(23)  Regulation (EU) 2024/1263 of the European Parliament and of the Council (EU) on the effective coordination of economic policies 
and on multilateral budgetary surveillance, together with the amended Regulation (EC) No 1467/97 on the implementation of the 
excessive deficit procedure, and the amended Council Directive 2011/85/EU on the budgetary frameworks of Member States are the 
core elements of the reformed EU economic governance framework. 

(24)  OJ C, C/2025/640, 10.2.2025, ELI: http://data.europa.eu/eli/C/2025/640/oj. 

(25)  On 29 April 2025, Slovenia requested to the Commission and to the Council the activation of the National Escape Clause. On this 
basis, the Commission adopted a Recommendation for a Council Recommendation allowing Slovenia to deviate from, and exceed, 
the net expenditure path set by the Council COM(2025)613. 

(26)  Communication  from  the  Commission  accommodating  increased  defence  expenditure  within  the  Stability  and  Growth  Pact of  19 

March 2025, C(2025) 2000 final. 

(27)  Commission (2025) ‘Debt Sustainability Monitor 2024,’ European Economy-Institutional Papers 306. 

26 

 
 
 
 
 
 
 
Table A1.1:  General government balance and debt 

Source: Commission Spring 2025 Forecast (COM), Annual Progress Report (APR) 

Developments in net expenditure  

The  net  expenditure (28)  growth  of  Slovenia  in  2025  is  forecast  by  the  Commission (29)  to  be  below  the 
recommended  maximum.  Considering  2024  and  2025  together,  the  cumulative  growth  rate  of  net 
expenditure is also projected below the recommended maximum cumulative growth rate. The Commission 
Spring  2025  Forecast  projects  lower  net  expenditure  growth  compared  to  the  Annual  Progress  Report 
mostly because of lower primary expenditure, in particular gross fixed capital formation.  

General government defence expenditure in Slovenia remained stable at 1.2% of GDP between 2021 and 
2023 (30). According to the Commission Spring 2025 Forecast, expenditure on defence is projected at 1.4% 
of GDP in 2024 and 1.6% of GDP in 2025. 

Table A1.2:  Net expenditure growth 

* The cumulative growth rates are calculated by reference to the base year of 2023. 
Source: Council Recommendation endorsing the national medium-term fiscal-structural plan of Slovenia (REC), Annual Progress 
Report (APR) and Commission's calculation based on Commission Spring 2025 Forecast (COM). 

(28)  Net expenditure is defined in Article 2(2) of Regulation (EU) 2024/1263 as government expenditure net of (i) interest expenditure, 
(ii) discretionary revenue measures, (iii) expenditure on programmes of the Union fully matched by revenue from Union funds,  (iv) 
national  expenditure  on  co-financing  of  programmes  funded  by  the  Union,  (v)  cyclical  elements  of  unemployment  benefit 
expenditure, and (vi) one-off and other temporary measures.  

(29)  Commission Spring 2025 Forecast, European Economy-Institutional paper 318, May 2025. 

(30) Eurostat, government expenditure by classification of functions of government (COFOG).  

27 

2024OutturnAPRCOMAPRCOM1General government balance% GDP-0.9-1.9-1.3n.a.-1.52General government gross debt% GDP67.066.065.5n.a.63.8Variables20252026RECAPRCOMRECAPRCOM2024n.a.4.5%4.5%n.a.n.a.n.a.20255.6%5.3%4.6%12.1%10.0%9.3%20264.4%n.a.7.0%17.0%n.a.17.0%AnnualCumulative*Growth rates 
 
                                                  
 
 
       
 
 
 
 
Table A1.3:  Net expenditure (outturn and forecasts), annual and cumulated deviations vis-à-vis the 
recommendation 

* The growth rate for 2024 is not a recommendation but serves to anchor the base, as the latest year with outturn data when 
setting the net expenditure path is year 2023. 
Source: Commission Spring 2025 Forecast and Commission’s calculation  

Table A1.4:  Defence expenditure and the national escape clause 

Source:  Eurostat (COFOG), Commission Spring 2025 Forecast and Commission’s calculation 

Table A1.5:  Macroeconomic developments and forecasts 

Source: Commission Spring 2025 Forecast (COM), Annual Progress Report (APR) 

28 

2023202420252026OutturnOutturnCOMCOM1Total expenditurebn NAC29.731.333.635.72Interest expenditurebn NAC0.80.90.91.03Cyclical unemployment expenditurebn NAC-0.1-0.1-0.1-0.14Expenditure funded by transfers from the EUbn NAC0.80.61.00.85National co-financing of EU programmesbn NAC0.20.10.10.16One-off expenditure (levels, excl. EU funded)bn NAC0.30.20.40.07=1-2-3-4-5-6Net nationally financed primary expenditure (before discretionary revenue measures, DRM)bn NAC27.729.631.333.88Change in net nationally financed primary expenditure (before DRM)bn NAC1.91.72.59DRM (excl. one-off revenue, incremental impact)bn NAC0.70.40.310=8-9Change in net nationally financed primary expenditure (after DRM) bn NAC1.31.42.211Outturn / forecast net expenditure growth% change4.5%4.6%7.0%12Recommended net expenditure growth*% change6.2%5.6%4.4%13=(11-12) x 7Annual deviationbn NAC-0.5-0.30.814 (cumulated from 13)Cumulated deviationbn NAC-0.5-0.80.115=13/17Annual balance% GDP-0.7-0.41.116=14/17Cumulated balance% GDP-0.7-1.10.117p.m. Nominal GDP  bn NAC64.067.070.273.9Variables2021202220232024202520261Total defence expenditure% GDP1.21.21.21.41.61.72of which: gross fixed capital formation% GDP0.20.10.30.40.40.43Flexibility from increases in defence expenditure% GDP0.40.54Cumulated balance after flexibility% GDP-1.5-0.42024OutturnAPRCOMAPRCOM1=7+8+9Real GDP% change1.62.12.02.42.42Private consumption% change1.62.22.22.32.33Government consumption expenditure% change8.52.72.84.13.74Gross fixed capital formation% change-3.71.00.73.02.85Exports of goods and services% change3.22.62.23.43.06Imports of goods and services% change3.92.72.23.93.4Contributions to real GDP growth 7- Final domestic demandpps1.72.01.92.52.58- Change in inventoriespps0.30.00.00.00.09- Net exportspps-0.40.10.2-0.1-0.110Output gap% pot GDP1.31.01.01.21.211Employment % change0.10.10.60.40.712Unemployment rate%3.73.73.73.73.813Labour productivity% change1.42.01.42.01.814HICP % change2.02.32.12.31.915GDP deflator% change3.12.82.82.72.716Compensation of employees per head% change6.27.15.65.54.717Net lending/borrowing vis-à-vis the rest of the world% GDP4.4n.a.4.6n.a.4.620252026Variables 
 
       
 
 
 
 
            
 
 
 
                                                  
 
 
Table A1.6:  General government budgetary position 

Source: Commission Spring 2025 Forecast (COM), Annual Progress Report (APR) 

Table A1.7:  Debt developments 

* End of period.  
** The 'snow-ball' effect captures the impact of interest expenditure on accumulated general government debt, as well as the 
impact of real GDP growth and inflation on the general government debt-to-GDP ratio (through the denominator). The stock-flow 
adjustment includes differences in cash and accrual accounting (including leads and lags in Recovery and Resilience Facility grant 
disbursements), accumulation of financial assets, and valuation and other residual effects. 
Source: Commission Spring 2025 Forecast and Commission’s calculation (COM), Annual Progress Report (APR) 

29 

2024OutturnAPRCOMAPRCOM1=2+3+4+5Revenue45.846.246.5n.a.46.8of which:2- Taxes on production and imports12.912.913.0n.a.12.93- Current taxes on income, wealth, etc.8.58.58.5n.a.8.54- Social contributions17.317.817.9n.a.18.45- Other (residual)7.17.07.1n.a.7.08=9+16Expenditure 46.848.147.8n.a.48.3of which:9- Primary expenditure45.546.846.6n.a.47.0of which:10- Compensation of employees 11.411.711.7n.a.11.911- Intermediate consumption6.76.86.8n.a.6.812- Social payments18.618.918.9n.a.19.313- Subsidies1.11.21.2n.a.1.214- Gross fixed capital formation5.15.55.3n.a.5.215- Other2.72.72.7n.a.2.716- Interest expenditure1.31.31.3n.a.1.318=1-8General government balance-0.9-1.9-1.3n.a.-1.519=1-9Primary balance0.4-0.6-0.1n.a.-0.220Cyclically adjusted balance-1.5n.a.-1.8n.a.-2.121One-offs-0.3-0.6-0.6n.a.0.022=20-21Structural balance-1.2-1.8-1.2n.a.-2.123=22+16Structural primary balance0.1-0.50.1n.a.-0.8Variables (% GDP)202520262024OutturnAPRCOMAPRCOM1Gross debt ratio* (% of GDP)67.066.065.5n.a.63.82=3+4+8Change in the ratio (pps. of GDP)-1.4-1.1-1.6n.a.-1.7Contributions**3Primary balance-0.40.60.1n.a.0.24≈5+6+7Snow-ball' effect-1.8-1.9-1.8n.a.-1.9of which:5- Interest expenditure1.31.31.3n.a.1.36- Real growth effect-1.0-1.4-1.3n.a.-1.57- Inflation effect-2.0-1.8-1.8n.a.-1.78'Stock-flow' adjustment0.80.20.2n.a.0.020252026Variables 
 
                                                  
 
 
 
 
                                                  
 
 
Table A1.8:  RRF – Grants 

Source: Annual Progress Report 

Table A1.9:  RRF - Loans 

Source: Annual Progress Report 

Cost of ageing  

Total age-related spending in Slovenia is projected to rise from about 22% of GDP in 2024 to 
25% in 2040 and to 27.5% in 2070 (see Table A1.10). The overall increase of around 5 pps of GDP 
by 2070 is mainly due to rising in pension expenditure, with also higher spending on healthcare and long-
term care.  

Public pension spending is projected to rise by 3.5 pps of GDP by 2070, of which about 2 pps 
would occur by 2040. This puts Slovenia among the countries with the highest projected increase of all 
Member States compared with 2024, with pension expenditure reaching 13.7% of GDP in 2070, compared 
with an EU average of 11.8%. 

Public  healthcare  expenditure  is  projected  at  6.9%  of  GDP  in  2024  (slightly  above  the  EU 
average of 6.6%) and is expected to increase by 0.7 pps by 2040 and by a further 0.3 pps by 

30 

Revenue from RRF grants (% of GDP)20202021202220232024202520261RRF grants as included in the revenue projectionsn.a.0.20.20.60.50.70.72Cash disbursements of RRF grants from EUn.a.0.40.00.50.20.50.520202021202220232024202520263Total current expendituren.a.n.a.0.00.10.10.40.34Gross fixed capital formationn.a.0.20.10.10.20.30.25Capital transfersn.a.n.a.0.00.10.00.10.16=4+5Total capital expendituren.a.0.20.10.20.20.50.320202021202220232024202520267Reduction in tax revenuen.a.n.a.n.a.n.a.n.a.n.a.n.a.8Other costs with impact on revenuen.a.n.a.n.a.n.a.n.a.n.a.n.a.9Financial transactionsn.a.n.a.n.a.n.a.n.a.n.a.n.a.Expenditure financed by RRF grants (% of GDP)Other costs financed by RRF grants (% of GDP)Cash flow from RRF loans projected in the Plan (% of GDP)20202021202220232024202520261Disbursements of RRF loans from EUn.a.n.a.n.a.0.50.20.10.12Repayments of RRF loans to EUn.a.n.a.n.a.n.a.n.a.n.a.n.a.20202021202220232024202520263Total current expendituren.a.n.a.n.a.0.00.00.00.04Gross fixed capital formationn.a.n.a.0.00.10.20.10.25Capital transfersn.a.n.a.n.a.n.a.0.00.00.16=4+5Total capital expendituren.a.n.a.0.00.10.20.10.220202021202220232024202520267Reduction in tax revenuen.a.n.a.n.a.n.a.n.a.n.a.n.a.8Other costs with impact on revenuen.a.n.a.n.a.n.a.n.a.n.a.n.a.9Financial transactionsn.a.n.a.n.a.n.a.n.a.n.a.n.a.Expenditure financed by RRF loans (% of GDP)Other costs financed by RRF loans (% of GDP) 
 
                                                  
 
 
 
                                                  
 
2070.  While  the  overall  increase  is  driven  by  an  ageing  population,  it  is  further  influenced  by  a  recent 
increase in access to mental health services and increase in salaries of the healthcare workforce (31).  

Public  expenditure  on  long-term  care  is  projected  at  1.0%  of  GDP  in  2024  (below  the  EU 
average  of  1.7%)  and  is  expected  to  increase  by  0.5 pps  of  GDP  by  2040  and  by  a  further 
0.5 pps of GDP by 2070. The projected increase is due to an ageing population but does not reflect yet 
the budgetary impact of the latest reforms on long-term care (32).  

Table A1.10:Projected change in age-related expenditure in 2024-2040 and 2024-2070 

Source: 2024 Ageing Report (EC/EPC). 

(31)  Key performance characteristics, recent reforms and investments of the Slovenian healthcare system are discussed in Annex 14 

‘Health and health systems’.    

(32)  The adequacy and quality of the Slovenian long-term care system are covered in Annex 11 ‘Social policies’. 

31 

SI22.31.90.70.5-0.42.725.0SIEU24.30.50.30.4-0.30.925.2EUSI22.33.50.91.0-0.25.227.5SIEU24.30.20.60.8-0.41.325.6EUage-related expenditure 2024 (% GDP)change in 2024-2040 (pps GDP) due to:age-related expenditure 2040 (%GDP)pensionshealthcarelong-term careeducationtotalage-related expenditure 2024 (% GDP)change in 2024-2070 (pps GDP) due to:age-related expenditure 2070 (%GDP)pensionshealthcarelong-term careeducationtotal 
 
  
 
 
National fiscal framework 

Slovenia  has  split  the  Independent  Fiscal  Institution  (IFI)  tasks  on  two  institutions,  both  of 
which  could  benefit  from  measures  to  strengthen  their  independence.  The  Fiscal  Council  (FC) 
focuses  on  monitoring  the  compliance  with  fiscal  rules  and  assessing  the  fiscal  forecast  of  the 
government and has recently developed its own budgetary forecast. Past capacity constraints, limiting the 
number  of  technical  staff  to  four  persons,  are  being  addressed  with  the  amended  Fiscal  Rule  Act.  The 
policy dialogue with the government is regular and persistent, although reporting by the media is rather 
selective  and  more  of  a  sporadic  nature.  The  FC  is  undertaking  outreach  activities  to  broaden  the 
awareness  of  fiscal  issues.  The  Institute  of  Macroeconomic  Analysis  and  Development  (IMAD),  which 
provides the macroeconomic forecasts underlying the budgetary planning, can only employ civil servants 
and  the  Director  can  be  prematurely  dismissed  in  the  first  year  of  new  government,  potentially  raising 
independence  issues.  IMAD  does  not  have  a  formal  communications  strategy  but  is  very  active  in 
communicating its work to different stakeholders as an IFI and as a national productivity board. 

Table A1.11:Fiscal Governance Database Indicators 

The Country Fiscal Rule Strength Index (C-FRSI) shows the strength of national fiscal rules aggregated at the country level based 
on i) the legal base, ii) how binding the rule is, iii) monitoring bodies, iv) correction mechanisms, and v) resilience to shocks. The 
Medium-Term Budgetary Framework Index (MTBFI) shows the strength of the national MTBF based on i) coverage of the 
targets/ceilings included in the national medium-term fiscal plans; ii) connectedness between these targets/ceilings and the 
annual budgets; iii) involvement of the national parliament in the preparation of the plans; iv) involvement of independent fiscal 
institutions in their preparation; and v) their level of detail. A higher score is associated with higher rule and MTBF strength. 
Source: Fiscal Governance Database 

32 

2023SloveniaEU AverageCountry Fiscal Rule Strength Index (C-FRSI)8.4714.52Medium-Term Budgetary Framework Index (MTBFI)0.780.73 
 
 
   
 
 
 
 
ANNEX 2: TAXATION 

This  annex  provides  an 
indicator-based 
overview of Slovenia’s tax system.  It includes 
information on: (i) the tax mix; (ii) competitiveness 
and  fairness  aspects  of  the  tax  system;  and  (iii) 
tax collection and compliance.  

In  2023  Slovenia’s  tax  revenues  were 
equivalent  to  36.6%  of  GDP,  slightly  lower 
than  the  EU  aggregate  of  39%.  Some 
relatively  growth-friendly  taxes,  such  as 
recurrent  property  taxes,  are  underused. 
Slovenia’s  strong  reliance  on  labour  taxation  is 
reflected  in  labour  taxes accounting  for  51.2%  of 
total  tax  revenues,  which  was  at  par  with  the  EU 
aggregate  of  51.2%.  Revenues  from  social-
security  contributions  expressed  as  a  percentage 
of  GDP  were  above  the  EU  aggregate  (15.6%  vs 
12.7%).  In  January  2024,  Slovenia’s  voluntary 
complementary  health  insurance  was  abolished 
and replaced with an additional mandatory health 
contribution.  The  additional  health  contribution 
was initially charged at EUR 35 per month in 2024. 
In  2025,  it  was  indexed  for  average  gross  wage 
growth in the previous year, and it will be adjusted 
in  the  same  way  in  the  future.  Starting  on 
1 July 2025,  a  mandatory  contribution  to  long-
term  care  will  also  be  charged  at  2%  of  gross 
wages  (1%  paid  by  employers  and  1%  by 

Table A2.1:  Taxation indicators 

employees) and at 1% of net pensions.  

Graph A2.1: Tax revenue shares in 2023 

Source: Taxation Trends Data, DG TAXUD 

The amendments to the Personal Income Tax 
Act,  which  entered  into  force  in  January 
2025,  aim  to  increase  the  productivity  and 
competitiveness  of  the  Slovenian  economy. 
The  amended  legislation  introduces  a  preferential 
tax  regime, which provides a  tax  credit of 7%  of 
the received salaries  for new residents  (Slovenian 
and  foreign  nationals  alike)  who,  on  arrival  in 
Slovenia:  (i)  are  under  40  years  of  age;  (ii)  have 
not  been  resident  in  Slovenia  for  the  last  two 
years;  and  (iii)  will  have  a  wage  of  at  least  twice 
the  last  published  average  wage  in  Slovenia.  The 

(1) Forward-looking effective tax rate (KPMG).       
(2) A higher value indicates a stronger redistributive impact of taxation. 
(*) EU-27 simple average. 
(**) Forecast value for 2023. For more details on the VAT gap, see European Commission, Directorate-General for Taxation and 
Customs Union, VAT gap in the EU - 2024 report,  https://data.europa.eu/doi/10.2778/2476549  
For more data on tax revenues as well as the methodology applied, see the Data on Taxation webpage, 
https://ec.europa.eu/taxation_customs/taxation-1/economic-analysis-taxation/data-taxation_en. 
Source: European Commission, OECD 

33 

51.226.921.951.234.214.6Tax revenue shares in 2023, Slovenia (outer ring) and EU (inner ring)Taxes on labourTaxes on consumptionTaxes on capitalSIMedian (EU-27)2010202120222023202420102021202220232024Tax structureTotal taxes (including compulsory actual social contributions) (% of GDP)38.638.737.836.637.840.239.739.0Taxes on labour (% of GDP)19.819.919.218.719.820.520.120.0of which, social security contributions (SSC, % of GDP)15.916.516.115.612.913.012.712.7Taxes on consumption (% of GDP)14.113.313.112.510.911.210.910.5of which, value added taxes (VAT, % of GDP)8.18.38.38.16.87.37.47.1Taxes on capital (% of GDP)4.85.65.55.37.18.58.78.5Personal income taxes (PIT, % of GDP)5.65.45.25.18.69.69.49.3Corporate income taxes (CIT, % of GDP)1.92.52.32.32.22.93.23.2Total property taxes (% of GDP)0.60.70.70.61.92.22.11.9Recurrent taxes on immovable property (% of GDP)0.50.50.50.41.11.11.00.9Environmental taxes (% of GDP)3.93.32.92.82.52.42.12.0Effective carbon rate in EUR per tonne of CO2 equivalentsNA97.6NA81.7NA86.0NA84.8Tax wedge at 50% of average wage (single person) (*)33.739.539.337.141.333.931.831.531.531.8Tax wedge at 100% of average wage (single person) (*)42.543.542.943.144.640.939.939.940.240.3Corporate income tax - effective average tax rates (1) (*)18.117.217.217.221.319.319.118.9Difference in Gini coefficient before and after taxes and cash social transfers (pensions excluded from social transfers) (2) (*)10.68.58.38.28.68.27.97.7Outstanding tax arrears: total year-end tax debt (including debt considered not collectable) / total revenue (in %) (*)4.84.335.532.6VAT gap (% of VAT total tax liability, VTTL) (**)3.69.27.86.67.0SloveniaEU-27Progressivity & fairnessTax administration & complianceBy tax baseSome tax types 
 
 
       
 
 
  
 
regime  also  provides  for  the  beneficial  tax 
treatment  of:  (i)  employee  stock  options;  and  (ii) 
employees  of  innovative  start-up  companies  by 
delaying the calculation of their tax liability.  

Revenues  from  recurrent  property  taxes, 
which  are  considered to  be one  of  the  taxes 
least  detrimental  to  growth,  were below  the 
taxes  were 
EU  aggregate.  Total  property 
equivalent  to  0.6%  of  GDP  in  Slovenia  in  2023 
(compared  with  1.9%  for  the  EU  aggregate),  of 
which  the  equivalent  of  0.4%  of  GDP  came  from 
recurrent property  taxes (compared  with  0.9% for 
the EU aggregate).  

from 

consumption 

Revenues 
and 
environmental  taxes  as  a  share  of  total 
taxation  in  Slovenia  were  above  the  EU 
aggregate,  but  revenues  from  capital  taxes 
were  below  the  EU  aggregate. 
In  2023 
revenues  from  VAT  expressed  as  a  percentage  of 
GDP were 1 pp. above the EU aggregate (8.1% vs 
7.1%)  while  revenues  from  corporate  income  tax 
(CIT)  as  a  percentage  of GDP  were 0.9 pps  below 
the  EU  aggregate  (2.3%  vs  3.2%).  The  December 
2023 Act on Reconstruction, Development and the 
Provision of Financial Resources increased the CIT 
rate  by  3  pps  to  22%  and  introduced  a  tax  on 
banking assets for 2024-2028. The revenue from 
these taxes will be  used to finance reconstruction 
after  the  August  2023  floods.  As  of  2025  VAT 
rates for sweet drinks are increased from 9.5% to 
22%. 

is  potential 

to  strengthen 

There 
the 
application  of  the  ‘polluter  pays’  principle. 
Slovenia  has  implemented  three  of  the  six  main 
types  of  pollution  and  resources  taxes  (i.e.  taxes 
on  waste  landfilling,  waste  loadings  to  water  and 
plastic  products).  There  could  be  scope  to  expand 
waste  disposal  taxes  (including  on  incineration) 
and  to  implement  the  three  other  types  of 
environmental  taxes  (i.e.  taxes  on  NOx  emissions, 
pesticides and fertilisers).  

Slovenia’s  labour-tax  wedge  is  high  across 
different  wage  levels  and  the  labour-tax 
burden  is  less  progressive  than  the  EU 
average.  Slovenia’s  labour-tax  wedge(33)  was 

to  a 

higher  in  2024  than  the  EU  average  at  various 
income  levels,  in  particular  for  single  people  at 
50%  of  the  average  wage  (see  Graph  A2.2). 
Second  earners  at  a  wage  level  of  67%  of  the 
average  wage,  whose  spouses  earn  the  average 
tax  wedge 
wage,  were  also  subject 
considerably  above  the  EU  average.  However,  the 
difference  between  their  tax  wedge  and  that  of 
single earners at the same wage level was clearly 
below  the  EU  average.  Slovenia  is  one  of  the 
Member  States  with  the  lowest  income  inequality 
(as measured by the Gini coefficient) and the tax-
benefit system helped reduce income inequality by 
more than the EU average in 2023 (a reduction of 
8.2  point  in  Slovenia  compared  to  an  EU-average 
reduction of 7.7 points). 

Graph A2.2: Tax wedge for single and second 
earners, % of total labour costs, 2024 

The tax wedge for second earners assumes a first earner at 
100% of the average wage and no children. For the full 
methodology, see OECD, 2016, Taxing Wages 2014-2015. 
Source: European Commission 

labour 

At the end of 2024, the government prepared 
and  submitted  further  tax  amendments  for 
public  consultation 
in  the  field  of  the 
introduction of a new real estate tax and the 
taxation.  Slovenia’s 
reduction  of 
planned  tax  reform  has  the  main  objective  of 
supporting  housing  policy  and  regulating  the 
housing  market  while  using  the  funds  raised  to 
reduce  labour  taxation,  by:  (i)  providing  for  an 
additional in-work tax allowance of EUR 2 000; (ii) 
reducing  the  highest  tax  rate  from  50%  to  43%; 
and (iii) introducing a reduced tax rate of 20% for 
annual  income  over  EUR 500 000.  On  the  real 
estate  taxation,  the  proposed  measures  were 
designed  in  the  direction  that  owner-occupied 
apartments  and  houses  would  be  exempted  from 

(33)  The  tax  wedge  is  defined  as  the  sum  of  personal  income 
taxes  and  employee  and  employer 
social-security 
contributions  net  of  family  allowances,  expressed  as  a 

percentage of total labour costs (the sum of the gross wage 
and social-security contributions paid by the employer). 

34 

41.341.744.647.543.02025303540455050100150Tax wedge, % of total labour costsEarnings as % of the average wageSingle earner - SISingle earner - EU averageSecond earner -  SISecond earner -  EU average 
 
 
       
 
are  100%  for  both  types  of  tax),  indicating  a 
relatively  low  compliance  burden  for  these  taxes 
due to streamlined digital processes. However, the 
personal-income-tax  e-filing  rate  stands  at  25%, 
suggesting  a  higher  compliance  burden  for 
individual taxpayers.  

Tax  compliance  and  collection  appear  to  be 
relatively  effective.  Outstanding  tax  arrears 
declined  slightly  by  0.5  pps  to  4.3%  of  total  net 
revenue in  2022. This was significantly below the 
EU-27 average of 32.6%, but that EU-27 average 
was inflated by very large values in a few Member 
States.  In  2023,  Slovenia’s  VAT  compliance  gap 
amounted to 7.8% of the VAT total tax liability.  

taxation but only the owners of a second property 
and each subsequent property would be taxed at a 
1.45%  tax  rate  of  the  generalised  value  of  the 
property.  It  was  proposed  that  individuals  renting 
out  their  properties  on  long-term  rental  contracts 
would benefit from a tax reduction of 25% of the 
declared rental income. 

Slovenia  uses  generous  expenditure–based 
tax  incentives,  such  as  tax  incentives  for  R&D 
expenses,  investment  tax  incentives,  depreciation 
of tangible fixed assets, amortisation of intangible 
assets,  and  depreciation  of  investment  property. 
These incentives are all targeted at increasing the 
likelihood  of  generating  additional  investment  as 
they directly target investment expenses.  

Slovenia  also  allows  for  the  use  of  retained 
tax  losses,  which  is  limited  to  a  maximum  of 
50% of the actual tax base. An amendment to the 
Corporate Income Tax Act, which entered into force 
on  1 January 2025,  has  limited  the  possibility  of 
utilising  tax  losses  to  five  tax  periods,  while  also 
providing  for  a  transitional  regime.  Carry-back  of 
losses is not permitted. 

tax  allowance 

transition.  The 

Slovenia  has  an  investment  allowance  for 
investing  in  digital  transformation  and  the 
for 
green 
investment  in  equipment  and  intangible  assets  is 
limited to 40% of the cost of investing in: (i) cloud 
computing;  (ii)  artificial  intelligence;  (iii)  big  data; 
(iv)  environmentally  friendly  technologies; 
(v) 
cleaner,  cheaper  public  and  private  transport;  (vi) 
the  decarbonisation  of  the  energy  sector;  (vii)  the 
(viii) 
energy 
implementing  other 
climate 
neutrality.  As  of  1  January  2025,  this  allowance 
can  be  claimed  in  five  tax  periods  following  the 
investment period. 

efficiency  of  buildings;  and 

standards 

for 

Slovenia does not have a specific tax regime 
or  tax  incentives  for  venture  capital.  Well-
designed venture-capital incentives could help with 
the supply of venture-capital financing, particularly 
given  that  Slovenia  ranks  last  in  venture-capital 
financing  as  a  percentage  of  GDP  among  24  EU 
countries for which data are available. 

through 

its  tax 
Slovenia  is  working  to  improve 
comprehensive 
administration 
digitalisation  efforts,  as  outlined 
its 
strategic  commitment  to  investing  in  IT 
infrastructure.  Slovenia's  e-filing  rates  are  high 
for  CIT  and  value  added  tax  (VAT)  (e-filing  rates 

in 

35 

 
 
PRODUCTIVITY 
ANNEX 3: INNOVATION TO BUSINESS  

the  European 

Slovenia  continues  to  fall  short  on  the 
implementation  of  its  ambitious  targets  for 
R&D  investment  and  access  to  finance  for 
innovative  SMEs.  According  to  the  2024  edition 
Innovation  Scoreboard,(34) 
of 
Slovenia  remains  a  moderate  innovator.  While  its 
performance (at 91% of the EU average) is above 
the average of the moderate innovators (84.8%), it 
is increasing at a slower pace than the EU average. 
The country’s performance gap with the EU is thus 
growing.  The  main  factor  holding  back  Slovenia’s 
performance continues to be low R&D expenditure 
in the public sector. R&D intensity stood at 2.13% 
of GDP in 2023, slightly below the EU average and 
still far behind Slovenia’s own ambitious target of 
3.5%  of  GDP  by  2030  (35).  To  reach  its  own 
objective  of  becoming  a  leading  innovator  by 
2030,  Slovenia  needs  to  further  accelerate  R&D 
investment, in line with the commitments made in 
its  RDI  strategy.  The  comparatively  low  uptake  of 
digital  technologies  by  SMEs  also  remains  a 
challenge  in  terms  of  achieving  the  EU’s  Digital 
Decade target. 

Graph A3.1: R&D intensity (GERD as a percentage 
of GDP), 2013-2023 

Source: Eurostat 

(34)  2024 European Innovation Scoreboard, Country profile, 

Slovenia: https://projects.research-and-
innovation.ec.europa.eu/en/statistics/performance-
indicators/european-innovation-scoreboard/eis-
2024#/eis/countries/SI . The EIS provides a comparative 
analysis of innovation performance in EU countries, including 
the relative strengths and weaknesses of their national 
innovation systems (also compared to the EU average). 

(35)  Resolution  on 

the  Slovenian  scientific 

research  and 

innovation strategy 2030 (ReZrIS30),. 

. 

Science and innovation ecosystems 

for  54.6%  of 

In 2023, public expenditure on R&D stood at 
0.64%  of  GDP,  below  the  EU  average  of 
0.72%  and  still  far  behind  Slovenia’s  own 
ambitious target of reaching 1.25% by 2030. 
Slovenia’s modest level  of  public  R&D  investment 
has  not  improved  significantly  over  the  last 
decade,  holding  back  its  scientific  performance. 
Despite  increasing  research  collaboration  with 
international  co-
other  countries 
(in  2023 
publications  accounted 
total 
publications in Slovenia, against the EU average of 
55.9%), Slovenian scientific publications in the top 
10%  most-cited  publications  worldwide,  as  a 
total  scientific 
the  country’s 
percentage  of 
publications, is 7.4% compared to the EU average 
of  9.6%.  The  increasingly  open  research  system 
has  therefore  yet  to  translate  into  excellent 
science.  The  RDI  strategy  contains  a  clear 
commitment to raise R&D investments with a view 
to  reaching  a  target  of  1.25%  of  GDP  for  public 
R&D investment and of 3.5% of GDP for total R&D 
investment  by  2030.  Together  with  the  Act  on 
Research,  Development  and  Innovation  Activities 
(36),  it  aims  to  provide  a  stable  and  predictable 
framework  for  R&I  funding  over  the  long  term. 
However,  the  public  R&D  spending  has  not 
increased  by  0.08%  of  GDP  as  stipulated  by  the 
Act.  Maintaining  a  solid  path  in  terms  of  public 
R&D investment, in line with the RDI strategy and 
the Act, will be key for Slovenia to be able to fully 
exploit its scientific potential. 

improving 

Further 
coordination  within 
Slovenia's R&D system is crucial for boosting 
investment  and  competitiveness.  A  lack  of 
cross-sector  interaction  and  strategic  guidance  in 
the  past  has  resulted  in  fragmented  funding  and 
hindered 
long-term  cooperation  among  R&D 
players.  To  address  this,  Slovenia  has  undertaken 
significant reforms to its R&D governance system, 
as  part  of  the  recovery  and  resilience  plan  (RRP), 
which  includes  the  RDI  Act  and  the  national  RDI 
strategy.  These 
the 
establishment of a high-level Development Council 

reforms  also 

included 

(36)  Act on Research, Development and Innovation Activities (in 
Slovenian) https://pisrs.si/pregledPredpisa?id=ZAKO7733  

36 

11.522.533.5420132014201520162017201820192020202120222023SloveniaEU averageDKSEFI 
 
 
       
 
 
 
 
and a cross-government Programme Committee to 
supervise  and  monitor  the  implementation  of  the 
new  R&D  measures.  At  the  same  time,  the 
relevant ministries and agencies were restructured 
to  allow  better  coordination  of  research  and 
to  ensure 
innovation  policies.  Nevertheless, 
continuity  and  the  effectiveness  of  the  new  R&D 
governance model, additional measures should be 
implemented, such as providing analytical support 
to  the  existing  governance  bodies  for  evidence-
based  policymaking  or  strengthening  the  role  of 
strategic research and innovation partnerships (37). 

Business innovation 

and 

excellence 

Business  R&D  intensity  is  close  to  the  EU 
average  at  1.49%  of  GDP  but  has  declined 
from 1.58% of GDP in 2020, while patenting 
activity  remains  below  the  EU  average. 
Slovenia  is  underperforming  in  terms  of  scientific 
research 
product 
commercialisation,  which  is  also  reflected  in  its 
patenting  activity.  Patents  filed  under  the  Patent 
Cooperation Treaty per billion GDP have been on a 
declining trend in the last decade, falling to 1.8 in 
2022,  below  the  EU  average  of  2.8 (38).  The 
Slovenian  ICT  sector  (usually  R&D-intensive)  is 
among the smallest in the EU, accounting for 4.3% 
of  GDP  compared  with  the  EU  average  of  5.5%. 
Also,  the  share  of  expenditure  on  R&D  in  the  ICT 
sector  is  the  lowest  in  the  EU,  at  9.8%  of  total 
R&D  expenditure (39).  Surveys  suggest  that  low 
business investment is partly related to the lack of 
skilled  labour (40).  Growth  of  start-ups  in  the  later 
stages  of  development  is therefore  held  back  not 
only  by  insufficient  funding,  but  also by  a  lack  of 
human resources with specific skills. 

Stronger 
links  between  academia  and 
businesses  are  essential  to  strengthen 

(37)  OECD,  2024:  Improving  the  Governance  Model  of  the 
Research  and  Innovation  System  in  Slovenia,  Improving  the 
Governance Model of the Research and Innovation System in 
Slovenia - European Commission (europa.eu). 

(38)  Compound  annual  growth  in  the  period  2012-2022  was  - 

5.4%. 

(39)  Eurostat, ICT  sector  size (data  from  2022)  and R&D  in  ICT 

sector,(data from 2021). 

(40)  See European Investment Bank Investment Survey 2023, EIB 

Investment Survey 2023: European Union overview. 

37 

to 

linkages 

research 

lags  behind 

that  of  SMEs 

remain  underexploited 

innovation  collaboration  with 

Slovenia’s  innovation  potential  and  thus  the 
competitiveness  of  the  economy.  Science-
business 
in 
Slovenia.  This  is  reflected  in  the  proportion  of 
public  R&D  expenditure  financed  by  businesses, 
which  is  well  below  the  EU  average  (0.022%  of 
GDP vs 0.050% for the EU average). The rate has 
been  declining  over  time,  hinting  at  businesses 
labs. 
being  reluctant  to  work  with  research 
Slovenian SMEs play a bigger role in the economy 
than  their  counterparts  in  the  rest  of  the  EU,  but 
research 
their 
in 
organisations 
innovation  leader  countries  (41).  It  is  therefore 
intensify  collaboration  between 
important 
universities, 
institutions  and  SMEs. 
Following  the  adoption  of  the  Act  on  Research, 
Development 
Activities, 
organisations  carrying  out  research  are  now  able 
to  set  up  companies.  The Slovenian  Research  and 
Innovation Agency (ARIS) promotes the application 
of  high-quality  scientific 
links 
between  public  research  institutes  and  its  end 
users. In addition to this, if implemented well, the 
investments  provided  for  in  the  RRP  will  further 
longer-term  collaboration  between 
strengthen 
large  enterprises  and 
research  organisations, 
SMEs (42).  With 
legislative 
necessary 
the 
framework  and  supporting  structures  in  place, 
Slovenia should be able to sustainably strengthen 
science-business  linkages,  but  first  results  may 
take  time  to  materialise  and  further  efforts  and 
monitoring will be essential. 

research  and 

Innovation 

and 

Slovenia  shows  a  mixed  picture  as  regards 
the  adoption  of  digital  technologies  by 
enterprises. The share of enterprises in Slovenia 
making use of artificial intelligence has progressed 
considerably and faster than the EU average (from 
11.4% to 20.9%, vs from 8% to 13.5% at EU level, 
from  2013  to  2024).  However,  Slovenia  has 
stagnated  at  around  68%  in  its  level  of  basic 
digital intensity for SMEs, while the rate increased 
from 69% to 73% on average in the EU. Slovenia 
is  taking  action  to  boost  the  uptake  of  advanced 

(41)  SMEs  represent  most  business  entities  (99.8%),  of  which 
90.8%  are  micro  enterprises.  In  2022,  SMEs  contributed 
66.9%  to  the  added  value  of  the  economy  and  employed 
73.3%  of  all  employees  in  Slovenia  (OECD  SCOREBOARD: 
Financing SMEs and Entrepreneurs 2024). 

(42)  The  investment  consists in  the co-financing of  collaborative 
projects between research organisations and business at all 
levels of technological development (COM(2023) 575 final), 
resource.html (europa.eu). 

 
 
 
in 

technologies  among  large  companies  and  SMEs, 
including  via  the  Recovery  and  Resilience  Facility, 
and  the  European  Digital  Innovation  Hubs  also 
make  their  services  available  to  Slovenian  SMEs. 
As  set  out 
its  RRP,  Slovenia  engages 
considerably  in  EU-wide  collaboration  to  develop 
advanced 
and 
infrastructure 
technologies  by  participating 
in  multi-country 
projects  on  cloud  infrastructure  and  services, 
semiconductors  and  quantum  communication 
infrastructure. 

deploy 

for 

in 

cooperation  within 

itself  as  a 
Slovenia  wants  to  position 
European  leader  in  green  technology  by 
harnessing  circularity  to  transform  and 
decarbonise  its  economy.  To  do  achieve  this, 
improve  the  transfer  of 
Slovenia  needs  to 
knowledge  and  access  to  finance  for  innovative 
SMEs,  to  allow  them  to  set  up 
large-scale 
production,  and  promote  new  technologies (43). 
the  Strategic 
Expanding 
Research  and 
Innovation  Partnership  (SRIP  – 
Circular  Economy)  would  help  Slovenia  boost  its 
competitiveness 
global  markets  while 
developing  a  circular  economy (44).  The  transition 
to  a  low-carbon  circular  economy  depends  on  the 
development  of  new  breakthrough  technologies. 
Slovenian performance in eco-innovation has been 
increasing more  than  the EU  average  since  2014, 
mainly  due  to  a  strong  increase  in  academic 
publications.  However,  this  has  not  yet  translated 
into  new  environment-related  technologies,  as 
reflected 
low  number  of 
relatively 
environment-related  patents (45).  The  country  has 
several demonstrators for low-carbon technologies 
funded  by  the  EU,  but  to  meet  its  objectives  it 
needs to accelerate both innovation and pilot and 
demonstration  activities  and  increase  investment 
incentives. 

the 

in 

(43)  Nikola  Vrabec,  Maja  Hranilovic,  Ecorys:  Eco-Innovation 
Country Profile 2022: Slovenia, EcoAP - Library (europa.eu). 

(44)  SRIP  –  Circular  economy 

is  a  network  of  Slovenian 
institutions,  non-
businesses,  educational  and  research 
governmental  organisations  and  the  State  aiming  to  make 
the economy more competitive in the transition to a circular 
economy.  About  us  -  SRIP  -  Krožno  gospodarstvo  (srip-
circular-economy.eu) 

(45)  European  Commission,  EU  Eco-Innovation  Index  2024,  EU 
eco-innovation  index  2024  -  Publications  Office  of  the  EU 
(europa.eu). 

38 

Financing innovation 

is 

A lack of venture capital continues to hinder 
innovative start-ups from scaling up. Venture 
capital investment in Slovenia amounts to 0.005% 
of  GDP,  the  second  lowest  value  in  the  EU.  The 
enterprise birth rate is roughly the same as the EU 
lagging  behind  on 
average,  but  Slovenia 
innovative start-ups. Slovenia has a relatively high 
number of innovating SMEs, but limited  access to 
venture  capital  affects  their  ability  to  scale  up 
innovations (46).  The  country  needs  to  improve  the 
support  environment  for  start-ups  by  increasing 
the  availability  of  venture  capital  and  further 
strengthen  cooperation  between  companies  and 
knowledge  institutions,  including  at  market-entry 
level. Access to finance is needed in particular for 
technology  demonstration,(47)  where  investment 
and  further  development  work  are  required  for 
innovations  to  reach  the  market (48).  The  capital 
market development strategy, adopted by Slovenia 
in  2023,  thus  focuses  on  improving  access  to 
equity  finance.  If  it  is  successfully  implemented, 
the  strategy  could  stimulate  the  development  of 
new innovative SMEs with a high potential for fast 
growth.  To  improve  access  to  the  venture  capital 
market  in  Slovenia  the  VESNA  Venture  Capital 
Fund  was  set  up,  and  the  Slovenian  Enterprise 
Fund  has  prepared  a  new  proposal  for  equity 
financing  for  the  period  2024–2029 (49).  Other 
measures,  such  as  adopting  a  new  act  on 
alternative  investment  funds,  have  also  been 
implemented  as  part  of  the  RRP,  but  there  is  still 
room  for  speeding  up  reforms  to  improve  access 
to finance (50). 

(46)  OECD Economic Surveys: Slovenia, 2024. 

(47)  TRL levels 5-6 

(48)  Tamara  Besednjak  Valič,  Erika  Džajić  Uršič:  Technology 
Transfer  Offices  for  Better  Management  of  the  University-
Industry  Collaboration:  Comparison  of  Slovenia,  Italy,  and 
Malta, 2024. 

(49)  The new fund will focus on the ‘proof-of-concept’ stage that 
could be commercialised and transformed into companies. It 
will  also  help  draw  up  a  consistent  intellectual-property 
transfer  framework  with  university  offices  responsible  for 
commercialising research. 

(50)  Slovenia  has  implemented  a  range  of  measures  to  fill  the 
gaps  in  SMEs’  access  to  finance,  such  as  blended  finance 
with  mentoring  and  training  for  innovative  and  early-stage 
start-ups 
SMEs 
SCOREBOARD: 
and Entrepreneurs 2024). 

Financing 

(OECD 

 
 
 
leaders,  especially 

26.6%  in  2022.  The  number  of  new  doctorate 
graduates  has also increased to slightly above the 
EU  average  (1.0  per  thousand  population  in 
Slovenia,  0.9  in  the  EU)(51).  The  gap  with  the 
innovation 
terms  of 
in 
large  and  the  education 
excellence,  remains 
system is not well enough adapted to the needs of 
the  private  sector (52).  This  could  change 
if 
ICT  training 
companies  further  expanded  the 
provided  to  staff,  which  is  already  above  the  EU 
average (137.4%), and if more attention was paid 
to  developing  top-quality  human  resources,  such 
as researchers and people with PhDs, especially in 
technical fields (53). 

Graph A3.2: Venture capital as a percentage of 
GDP, 2023 

Source: Invest Europe 

Innovative talent 

its  potential 

Human resources present a mixed picture. To 
turn 
into  a  competitive 
advantage,  Slovenia  needs  to  make  further 
progress  in  this  area.  Significant  efforts  are 
to  strengthen  entrepreneurship 
being  made 
education. A Strategic Council for Entrepreneurship 
in  Education  has  been  in  place  since  2020.  In 
higher  education,  entrepreneurship  education  is 
available  to  all  students  through  specialised 
courses  and  activities.  Further  efforts  could  focus 
on  primary  and  general  secondary  education,  as 
well  as  on  the  understanding  of  entrepreneurship 
as a skill rather than as a specific profession.  The 
share of tertiary-educated people is below the EU 
average. Despite the high share of the population 
involved in lifelong learning, the proportion of the 
workforce  with  more  than  basic  digital  skills 
remains  low  (63.8%  of  the  EU  average)  and  has 
decreased marginally over the past years (see also 
Annex  12).  The  proportion  of  science,  technology, 
engineering  and  mathematics  graduates 
in 
Slovenia  has  risen  by  4.55  percentage  points  to 
29.5%  since  2016,  surpassing  the  EU  average  of 

(51)  Source: Eurostat 

(52)  Nikola  Vrabec,  Maja  Hranilovic,  Ecorys:  Eco-Innovation 
Country Profile 2022: Slovenia, EcoAP - Library (europa.eu). 

(53)  IMAD: Productivity Report 2023 (gov.si). 

39 

00.050.10.150.20.250.30.35EEDKSELUNLFIFRDEESATLTBEIEHUCZITHRELBGPLLVPTCYSKROSIMT 
       
 
Table A3.1:  Key innovation indicators 

(1) EU average for the last available year or the year with the largest number of country data. 
Source:  Eurostat, DG JRC, OECD, Science-Metrix (Scopus database), Invest Europe, European Innovation Scoreboard 

40 

R&D intensity (gross domestic expenditure on R&D as % of GDP)2.581.882.162.142.12.13:2.243.45Public expenditure on R&D as % of GDP0.630.470.560.550.60.64:0.720.64Scientific publications of the country within the top 10% most cited publications worldwide as % of total publications of the country 76.98.17.4:::9.612.3Researchers (FTEs) employed by public sector (Gov+HEI) per thousand active population4.33.54.14.34.65.0:4.2:International co-publications as % of total number of publications43.448.551.753.152.554.6:55.939.3Business enterprise expenditure on R&D (BERD) as % of GDP1.961.411.581.571.481.47:1.492.7Business enterprise expenditure on R&D (BERD) performed by SMEs as % of GDP0.920.560.630.630.54::0.40.3Researchers employed by business per thousand active population4.65.76.66.66.56.6:5.7:Patent applications filed under the Patent Cooperation Treaty per billion GDP (in PPS €)2.92.721.81.8::2.8:Employment share of high-growth enterprises measured in employment (%)9.4916.210.68::::12.51:SMEs with at least a basic level of digital intensity% SMEs (EU Digital Decade target by 2030: 90%)::::67.14:67.6372.91:Data analytics adoption% enterprises (EU Digital Decade target by 2030: 75%):::::19.06:33.17:Cloud adoption% enterprises (EU Digital Decade target by 2030: 75%):::37.56:36:38.86:Artificial intelligence adoption% enterprises (EU Digital Decade target by 2030: 75%):::11.73:11.3720.8913.48:Public-private scientific co-publications as % of total number of publications8.58.39.79.79.79.5:7.78.9Public expenditure on R&D financed by business enterprise (national) as % of GDP0.061:0.0370.0320.022::0.050.02Total public sector support for BERD as % of GDP0.3990.2170.2270.2280.198::0.2040.251 R&D tax incentives: foregone revenues as % of GDP0.0910.1070.0820.1060.0980.092:0.1020.141BERD financed by the public sector (national and abroad) as % of GDP0.3080.1100.1450.1220.100::0.1000.110Venture capital (market statistics) as % of GDP (calculated as a 3-year moving average)0.0040.0080.0030.0030.0070.005:0.078:Seed funding (market statistics) as % of GDP 0.006.701.702.909.6017.40:7.30:Start-up and early-stage funding (market statistics) as % of GDP 79.7054.0077.4079.7065.6057.60:44.00:Later stage and scale-up funding (market statistics) as % of GDP 20.3039.2020.9017.3024.7024.90:48.70:New graduates in science and engineering per thousand population aged 25-3417.114.315.216.016.5::17.5:Graduates in the field of computing per thousand population aged 25-342.62.32.633.2::3.6:20222021Slovenia201220172020Headline indicatorScience and innovative ecosystemsR&D investment & researchers employed in businessesPublic support for business innovationInnovative outputsDigitalisation of businessesAcademia-business collaborationFinancing innovationInnovative talent2023EU average (1)USA2024 
 
       
 
ANNEX 4: MAKING BUSINESS EASIER 

Skills  shortages,  energy  costs,  uncertainty, 
and  access  to  finance  weigh  heavily  on  an 
already low level of business investment, yet 
some  significant  steps  have  been  taken  in 
improve  the  business 
recent  years  to 
environment.  Slovenia  has  made  notable 
progress  in  removing  administrative  barriers  and 
advancing  e-government,  but  perceptions  of 
improvement  remain  low,  and  obstacles  are  still 
seen as high. In addition to a lack of skilled labour, 
energy  costs  and  economic  uncertainty,  access  to 
finance  continues  to  be  a  major  barrier.  Despite 
being  highly  integrated  into  the  Single  Market, 
restrictions  persist  in  services,  including  some 
professions.  Despite  ongoing  efforts  to  improve 
the  public  procurement  system,  a 
lack  of 
competition  in  public  procurement  remains  a 
concern. 

Economic framework conditions 

some  positive  developments 

A  rather  low  level  of  private  investment  is 
hampering  productivity  growth  and  the 
country’s  innovation  capacity.  Though  there 
were 
the 
acceleration of innovation and investment activity 
in  2023 (54),  the  level  of  private  investment 
declined  once  more 
in  2024.  The  perceived 
investment gap reported by companies in Slovenia 
was  higher  than  the  EU  average,  with  18%  of 
firms  reporting  underinvestment  (EU  average, 
14%) (55). Slovenia was still among the EU Member 
States with the lowest inward FDI-to-GDP ratio (56). 

in 

are 

the  main 

A  lack  of  skilled  labour,  energy  costs,  and 
uncertainty 
reported 
investment  obstacles (57),  while  material 
shortages are decreasing.  According to the EIB 
Investment  Survey,  84%  of  businesses  see  the 
availability  of  skilled  staff  as  an  investment 

(54)  Institute of Macroeconomic Analysis and Development, 

2023, Productivity Report, Umar.gov.si. 

In  addition 

obstacle (58).  Slovenia  also  continues  to  exhibit 
some  persistent  labour  shortages  in  industry, 
having  one  of  the  highest  rates  in  the  EU,  with 
41.2%  of  companies  reporting  shortages  as  a 
limiting  factor  to  their  production  (see  also  the 
Labour  Market  Annex) (59). 
to 
demographic  factors,  the  slow  adaptation  of 
education  and  training  to  meet  the  needs  of  the 
transition  to  a  net-zero  and  digitalised  economy 
exacerbates  already  existing  constraints (60).  A 
slightly above-EU average vacancy rate as well as 
a  particular  shortage  of  ICT  specialists  and  a 
bottleneck in green skills may also complicate the 
transition (see also the Annexes on Labour Market 
and Education and Skills). Conversely, the share of 
businesses  facing  material  supply  constraints 
decreased from 37.8% in 2022 to 15.4% in 2023 
and 9.5% in 2024, which is below the EU average. 
However, energy-intensive industries have felt the 
burden of energy costs on business revenues since 
the  energy  crisis  (see  also  the  Affordable  Energy 
Transition Annex). 

is  the 

Access  to  finance  remains  an  investment 
late  payments  are  not  a 
obstacle,  but 
widespread  problem.  While  Slovenia  has  been 
taking  action  via  its  recovery  and  resilience  plan 
(RRP)  to  develop  its  capital  market  and  improve 
least 
access  to  finance,  the  country 
successful in  Europe  in  financing  business  growth 
through  venture  capital,  with  financing  heavily 
reliant  on  bank  loans  (see  the  Capital  Markets, 
Financial  Stability  and  Access  to  Finance  Annex). 
On  the  positive  side,  the  share  of  SMEs  reporting 
late  payments  is  below  the  EU  average,  mainly 
because only a small share of companies reported 
delayed  payment  from  public  entities  in  2024 
(12.7% vs an EU average of 16.6%). However, the 
share of SMEs that reported payment delays from 
private  entities  is  only  marginally  below  the  EU 
average  (47.4%  vs  47.9%)  (61).  Nevertheless, 
Slovenia had the smallest payment gap in the EU 
(the gap between the agreed  and actual payment 
times) for business-to-business payments, with an 
average  of  10  days  in  2024,  according  to  the 
Intrum  Payment  Report.  The  gap  for  payments 

(55)  European  Investment  Bank,  2024,  EIB  investment  survey 

(58)  European Investment Bank, 2024, EIB investment survey 

2024, Eib.org. 

2024, Eib.org. 

(56)  Institute of Macroeconomic Analysis and Development, 

(59)  European Commission, 2024, ECFIN Business and Consumer 

2024, Development Report, Umar.gov.si. 

Survey. 

(57)  European  Investment  Bank,  2024,  EIB  investment  survey 

(60)  Institute of Macroeconomic Analysis and Development, 

2024, Eib.org. 

2023, Productivity Report, Umar.gov.si. 

(61)  European Central Bank, 2024, SAFE Survey. 

41 

 
 
 
 
 
 
from the public sector has increased slightly (from 
9 to 12 days in 2024) but also remains low (62). 

identify 

businesses 

infrastructure  as  obstacles 

Slovenian  firms  consider  transport  and 
digital 
to 
investment, albeit to a lesser extent.  45% of 
Slovenian 
transport 
infrastructure  as  an  obstacle,  which  matches 
perfectly with the EU  average, while  13.9% see it 
as a major obstacle, which slightly exceeds the EU 
average. In addition, 30% see the country’s digital 
infrastructure as negatively impacting investment, 
which  is  a  smaller  share  than  the  EU  average  of 
41% (63). 

Graph A4.1: Making Business Easier: selected 
indicators. 

network  (VHCN)  coverage, 
is  around  the  EU 
average.  Despite  the  country’s  focus  on  rural 
areas,  Slovenia  still  faces  challenges,  with  only 
57%  of  rural  households  being  covered  by  VHCN, 
with  the  overall  VHCN  coverage  at  78.5%  (EU 
average 78.6%). Overall 5G coverage continues to 
improve  considerably  but  still  remains  below  the 
EU  average,  lying  at  82.1%  overall  (EU  average 
89%)  and  45.6%  in  rural  areas  (EU  average 
71.1%).  Cybersecurity  awareness  in  businesses  is 
also  increasing.  The  number  of  businesses  that 
experienced 
leading  to 
unavailability  of  ICT  services  due  to  an  external 
attack  (e.g.  ransomware  attacks,  denial  of  service 
attacks) slightly increased in Slovenia, from 2.15% 
in  2022  to  2.58%  in  2024,  yet  still  remained 
ICT  security 
below  the  EU  average  (3.43%). 
measures  were  deployed by  86%  of  firms  (below 
the  EU  average  of  93%) and  55%  of  firms made 
their  employees  aware  of  their  obligations  in  ICT 
security-related  issues  (below  the  EU  average  of 
60%). 

ICT  security 

incidents 

Slovenia  seems  to  have  improved  rules  for 
corporate  governance  in  its  many  state-
owned  enterprises  (SOEs)  (64).  The  OECD 
Product  Market  Regulation  (PMR)  (65)  database 
indicates  that  Slovenia  is  among  OECD  countries 
whose rules for public ownership and governing of 
SOEs  induce the lowest  distortions  to  competition 
and lowest shelter from market discipline (66). The 
in 
largest  SOEs  by  value  are  operating 
infrastructure, energy and transport. Nevertheless, 
Slovenia 
in 
companies in highly competitive sectors with little 
if  any  rationale  for  state  ownership  (e.g.  tourism) 
(67). 

to  maintain 

continues 

stakes 

Share of (1) enterprises, (2) average intra-EU exports and 
imports in GDP, (3) firms, (4) SMEs. 
Sources: (1) EIB IS, (2) Eurostat, (3) ECFIN BCS, (4) SAFE 
survey. 

Slovenia  has  solid  digital 
infrastructure 
overall  but  room  for  improvement  remains 
for  rural  areas  and  5G  coverage,  and  in 
business  awareness  of  cybersecurity.  Gigabit 
connectivity,  measured  by  very  high-capacity 

(64)  OECD, 2024, Ownership and Governance of State-Owned 

Enterprises 2024, Oecd.org. 

(65)  OECD, 2024, Product Market Regulation Policy Simulator 

2023-2024 Edition, Oecd.org. 

(66)  OECD, 2023, Descriptions of the components of the OECD 

(62)  Intrum, 2024, European Payment Report. 

PMR economy-wide indicator, Oecd.org. 

(63)  European Investment Bank, 2024, EIB investment survey 

(67)  Republic of Slovenia, 2025, Press release, Vlada dopolnila 

2024, Eib.org. 

strategijo upravljanja državnih naložb, Gov.si. 

42 

47.412.79.559.51647.916.61041.624.5010203040506070from private entitiesfrom public entitiesMaterial shortages as afactor limiting productionEU Trade IntegrationRegulation as a majorobstacle to investment(4) Late payments(3) Shortages(2) SingleMarket(1) RegulatoryburdenShare (%)EU27SI 
     
 
 
 
Reduction of regulatory and 
administrative barriers 

has 

gradually 

reduced 
improved 

the 
Slovenia 
administrative  burden  and 
its 
business environment, but challenges remain. 
Several  measures  have  been  taken  to  make  it 
easier to do business, for instance by setting up a 
single  point  of  contact  system  for  businesses,  or 
also through the Slovenian RRP, which includes the 
two  already  adopted  Debureaucratisation  Acts. 
Furthermore,  according  to  Slovenia’s  ‘STOP  the 
Bureaucracy’  portal,  over  300  measures 
to 
eliminate  administrative  barriers  have  already 
been  implemented,  most  of  them  in  finance, 
statistics, 
justice,  and  agriculture.  This  has 
contributed  to  reported  annual  savings  of  around 
EUR 420 million (68). However, perceptions of these 
changes  among  business  executives  remain  low 
and obstacles to companies are still seen as rather 
high.  Excessive  bureaucracy  (regulatory  density 
and 
frequent 
procedures) 
unpredictable changes in legislation and tax policy 
are  most  frequently  cited,  alongside  concerns 
about labour shortages and the general  economic 
situation (69). 

lengthy 

and 

Overall,  business  regulation  is  perceived  as 
less  of  an  obstacle  to  investment  than  on 
average  in  the  EU.  While  still  an  issue  for  52% 
and  a  major  issue  for  16%  of  businesses,  these 
shares  are  considerably 
lower  than  the  EU 
averages  of  66%  and  24.5%,  respectively  (70). 
Slovenia  is  also  ranked  as  more  competition-
friendly in  terms  of  administrative  and  regulatory 
burden  than  the OECD  average,  with licences  and 
less 
permits 
seen 
cumbersome (71). 
overall 
entrepreneurial  conditions,  Slovenia  has  started 
several  initiatives  over  the  past  few  years  to 
develop entrepreneurial skills among young people 
(72). 
an 

comparatively 
terms 

operates 

Slovenia 

SPIRIT 

as 
In 

also 

of 

entrepreneurship  programme  aimed  to  equip 
women  with  entrepreneurial  skills,  as  women  are 
still  considerably  less  likely  to  start  a  business 
than men (73). 

Slovenia  has  also  made  notable  progress  in 
e-government.  The  country  is  close  to  the  EU 
average  in  the  provision  of  digital  public  services 
for  people  and  businesses,  with  service  processes 
also  relatively  transparent  compared  to  the  EU 
average (74) 
Institutional 
(see 
Framework Annex). 

the  Effective 

Indebtedness  of  companies  is  lower  than 
average for the euro area, with the share of 
companies  with  a  high  exposure 
to 
insolvency  risk  decreasing.  This  share  declined 
after  a  temporary  increase  at  the  start  of  the 
COVID-19  pandemic  and  by  2023  was  already 
lower  than  during  the  global  financial  crisis (75). 
Slovenia has also already adopted an amendment 
to its Insolvency Act to transpose the EU Directive 
on  Restructuring  and  Insolvency  into  national 
law (76).  The  number  of  insolvency  proceedings 
initiated  against  companies  was  lower  in  2023 
than in 2019 for most activities (77). 

is 

to 

Slovenia 
improve 
taking  action 
processes  and  procedures  to  strengthen  tax 
compliance  related  to  corporate  income  tax. 
It  has  also  benefited  from  the  technical  support 
the  European  Commission (78). 
instrument  of 
Slovenia  has  a  high  tax  burden  on  labour,  which 
may  have  an  impact  on  attracting  workers  and 
business  competitiveness.  Slovenia’s  statutory 
corporate  income  tax  rate  has  been  temporarily 
increased  from  19%  to  22%  for  the  tax  years 
2024-2028. 

(73)  OECD, 2023, The Missing Entrepreneurs 2023, Oecd.org. 

(74)  European Commission, 2024, Digital Decade Country Report 

(68)  Republic of Slovenia, STOP the Bureaucracy portal, 

Slovenia, Ec.europa.eu. 

Stopbirokraciji.gov.si. 

(69)  Institute of Macroeconomic Analysis and Development, 

2024, Development Report, Umar.gov.si. 

(75)  Institute of Macroeconomic Analysis and Development, 

2023, Productivity Report, Umar.gov.si. 

(76)  OECD, 2022, Enhancing insolvency frameworks to support 

(70)  European Investment Bank, 2024, EIB investment survey 

economic renewal, Oecd.org. 

2024, Eib.org. 

(71)  OECD, 2024, Product market regulation – country note 

Slovenia, 2024, Oecd.org. 

(72)  EACEA, 2023, Youthwiki Slovenia, Eacea.ec.europa.eu. 

(77)  Institute of Macroeconomic Analysis and Development, 

2024, Development Report, Umar.gov.si. 

(78)  European Commission, Improving the administration of 
corporate income tax in Slovenia, 2024, Ec.europa.eu. 

43 

 
 
 
Single Market 

Slovenia  has  a  small,  open  and  diversified 
economy  with  one  of  the  highest  rates  of 
trade  integration  for  goods  in  the  Single 
Market. Intra-EU trade represented 59.3% of GDP 
in 2024 (mostly due to this high level  of trade in 
goods). The largest investors in Slovenia are from 
EU  Member  States,  with  Slovenia’s  main  trading 
partners  (Austria,  Germany,  Italy,  Croatia  and 
Switzerland) contributing about three fifths of the 
total value of direct investment (79). 

to 

The  country  has  one  of 
the  highest 
proportions of firms reporting engagement in 
international  trade.  According 
the  EIB 
Investment  Survey,  84%  of  Slovenian  firms 
imported  and/or  exported  goods  and/or  services 
(within  the  Single  Market  or  beyond),  well  above 
the  EU  average  of  63% (80).  The  economy  also 
continues  to  link  into  global  value  chains,  for 
instance  by  upgrading  production  with  other 
functions, such as research and development. This 
is reflected in increasing economic complexity and 
a  higher  share  of  exports  of  medium  and  high-
technology intensive products (81).  

services,  particularly 

Slovenia  is  one  of  the  most  restrictive 
Member States for trade in services. While the 
country’s  services  export  market  share  has 
increased,  its  trading  potential  in  fast-growing, 
knowledge-intensive 
in 
telecommunication,  computing  and  information 
services,  remains  under-utilised (82).  Insurance  is 
the most open sector in Slovenia while engineering 
services  are  the  most  restricted  when  compared 
with  other  countries,  with  potential  hindrances 
such  as  limitations  on  the  duration  of  stay  for 
service suppliers and limited recognition of foreign 
qualifications (83). 

(79)  Institute of Macroeconomic Analysis and Development, 

2024, Development Report, Umar.gov.si. 

(80)  European Investment Bank, 2024, EIB investment survey 

2024, Eib.org. 

(81)  Institute of Macroeconomic Analysis and Development, 

2023, Productivity Report, Umar.gov.si. 

(82)  Institute of Macroeconomic Analysis and Development, 

2024, Development Report, Umar.gov.si. 

(83)  OECD, 2024 Services Trade Restrictiveness Index (STRI), 

Oecd.org. 

Barriers also remain in professional services. 
While  Slovenia  has  reduced  the  number  of 
regulated  professions  to  some  extent  in  the  past 
(particularly  in  the  trades  and  crafts  sector), 
regulatory  restrictiveness  is  higher  than  the  EU 
average  for  professions  such  as  lawyers,  real 
estate  agents,  civil  engineers  and  architects  (84). 
Overall,  284  specific  professions  are  regulated  in 
Slovenia, which is the fourth highest number in the 
EU  and  considerably  above  the  EU  median (85). 
Reducing  regulatory  barriers  in  the  professional 
services sector will make entry easier and improve 
quality and prices (the RRP does not cover this). In 
particular, the profession of lawyer is more strictly 
regulated  than 
in  other  economies  and  the 
fragmented  system  regulating  civil  engineers 
could  hinder  the  free  movement  of  professionals. 
Rules  dividing  responsibility  between  different 
categories  of  professionals  in  the  same  area  of 
activity  could  reduce  the  proportionality  and 
In  addition, 
efficiency  of  service  provision. 
variations in regional regulations governing tourist 
guides may hinder market access and affect both 
national and cross-border service providers (86). 

Other  key  Single  Market  indicators  show 
signs of  continued  improvement.  Slovenia  has 
further  caught  up  on  its  lag  in  transposing  and 
conforming  with  Single  Market  directives  and 
increased  its  resolution  rate  for  SOLVIT,  the  EU-
rights resolution system. In 2024, Slovenia solved 
92.3%  of  the  SOLVIT  cases  it  handled  as  lead 
centre (EU average 84.9%) (87). The percentage of 
Single  Market  directives  not 
in 
reasonable time (transposition deficit) has dropped 
to 0.7% (below the EU average of 0.8%) and thus 
puts  Slovenia  firmly  on  track  to  reach  the  0.5% 
target  proposed  in  the  Single  Market  Act.  The 
conformity deficit (i.e. the percentage of all Single 
incorrectly)  also 
Market  directives  transposed 
continued 
further,  with  Slovenia 
outperforming  the  EU  average.  The  country  also 
remains below the EU average for the number and 
duration of Single Market infringement cases. 

to  narrow 

transposed 

(84)  OECD, 2024, Product market regulation – country note 

Slovenia, 2024, Oecd.org. 

(85)  European Commission, Regulated professions database, 

Ec.europa.eu. 

(86)  European Commission, 2021, Communication on updating 
the reform recommendations for regulation in professional 
services, COM(2021)385. 9/7/2021, Eur-lex.europa.eu. 

(87)  European Commission, Single Market and Competitiveness 

Scoreboard, Ec.europa.eu. 

44 

 
 
 
Public procurement 

Competition  within  public  procurement 
remains  a  challenge.  46%  of  contracts  were 
awarded  to  single  bidders  in  2024,  which  is  a 
slight  increase  compared  to  2023  (44%).  Service 
sectors like IT and maintenance have a particularly 
high  share  of  single  bids,  despite  efforts  to 
increase  competition.  In  addition,  21.5%  of  all 
procedures  in  2024  were  unsuccessful.  However, 
while  Slovenia’s  share  of  direct  awards  was  still 
above  the  EU  average,  it  declined  progressively 
from a high of 26% in 2020 to 8% in 2024. A very 
low share of contracts also tends to be awarded to 
bidders  from  other  countries  (part  of  the  Single 
Market  and  beyond) (88),  resulting  in  a  business 
environment  with  few  new  entrants.  This  further 
aggravates  the  lack  of  competition  in  what  is  a 
featuring 
very 
structural  deficiencies,  high  fragmentation  of  the 
public  procurement  system  and  a  complex 
regulatory  structure  where  public  procurement 
legislation  is  subject  to  frequent  revisions.  A 
slowdown  of  GDP  growth  also  reduced  bidder 
interest in 2024. 

small  procurement  market, 

However,  Slovenia  continues  to  work  on 
addressing  the  challenges  with  its  public 
system  and  has  already 
procurement 
implemented  various 
including 
initiatives, 
through the RRP. For example, in 2024, a public 
procurement  action  plan  was  adopted,  oriented 
towards  making  public  procurement  more 
competitive  and  effective,  and  bringing  in  some 
simplification tools. Slovenia has also successfully 
added  e-forms  to  its  national  system.  Further 
measures  to  improve  competition  in  procurement 
procedures  include  enhanced  training  through  the 
Public  Procurement  Academy,  established  through 
the  RRP,  and  training  for  bidders,  for  instance  by 
providing  regional  business  support  for  SMEs  to 
participate  in  public  procurement.  Furthermore, 
Slovenia’s  public  procurement  system  underwent 
an  independent  analysis  by  the  OECD  in  2024, 
which  offered  recommendations  for  potential 
improvements  to  the  institutional  and  regulatory 
frameworks  that  would  foster  competition  and 

improve  the  public  procurement  capacity  of  both 
contracting authorities and bidders (89). 

Slovenia  has  made  considerable  progress  on 
strategic  public  procurement,  in  particular 
green public procurement (GPP), with socially 
responsible  public  procurement  also  on  the 
rise.  GPP  accounted  for  28.55%  of  contracts 
in  2023,  while  socially  responsible 
awarded 
procurement  accounted 
for  14.22%,  which 
represents  an  increase  of  1.73  percentage  points 
in awarded contracts compared to 2022 (90). Under 
Slovenia’s  national  legislation,  it  is  mandatory  for 
all  public procuring  entities  to  take environmental 
aspects  into  account  when  procuring  goods  or 
services from 22 product and service groups (from 
electricity,  building  and  road  construction  to 
electronic  office  equipment)  (91).  A  measurement 
framework  to  monitor  the  environmental,  social 
and economic effects of GPP was also developed. 
results  create  a  baseline  for 
Measurement 
monitoring  the  effects  of  GPP  over  time  and  can 
be  used  to  improve  policies.  In  addition,  Slovenia 
has  also  progressed  in  socially  responsible  public 
procurement  and  by  2018  had  already  published 
guidelines  to  combat  ‘social  dumping’  within  the 
procurement of security and cleaning services (92). 

innovation. 

Public  procurement  could  also  be  used  more 
strategically  to  encourage 
In 
2022,  to  enable  the  development  and  use  of 
innovative  solutions  by  public  authorities,  the 
government  adopted  guidelines  on 
innovative 
public procurement, but the lack of awareness and 
reluctance  from  contracting  authorities  indicates 
that  these  efforts  have  not  been  enough  to  drive 
widespread  change.  The  uptake  of  innovation 
partnerships is also very low. Making effective use 
of  Slovenia’s  Public  Procurement  Academy,  which 
is  available  to  all  stakeholders  involved  in  public 
procurement  procedures  and  which  also  covers 
innovation  procurement,  could  help  improve  the 
situation.

(89)  OECD, 2025, Maximising the Benefits of Effective 
Competition in Public Procurement in Slovenia, . 

(90)  Republic of Slovenia, 2024, Statistical report on public 

contracts awarded in 2023, Ejn.gov.si. 

(91)  Official Gazette of the Republic of Slovenia, 2023, Green 

Public Procurement Regulation, Pisrs.si. 

(88)  Republic of Slovenia, 2024, Statistical report on public 

(92)  European Commission, 2024, Procurement Monitoring Report 

contracts awarded in 2023, Ejn.gov.si. 

– Slovenia, Ec.europa.eu. 

45 

 
 
 
Table A4.1:  Making Business Easier: indicators. 

*Change in methodology in 2024: reporting late payments from public and private entities separately. 
**Data on single bids for 2024 is provisional and subject to revision. Due to missing data, the EU average of direct awards data is 
calculated without Romania. 
Sources: (1) ECFIN BCS, (2) Eurostat, (3) EIB IS, (4) Digital Decade Country reports, (5) Intrum Payment Report, (6) SAFE survey, 
(7) OECD, (8) up to 2023: Single Market and Competitiveness Scoreboard, 2024: Public procurement data space (PPDS). 

46 

POLICY AREA20202021202220232024EU-27 average11.429.437.815.49.510.020.132.441.444.141.220.22.13.23.63.22.72.310.314.814.115.313.913.4-72.475.578.5-78.8-72.575.578.5-64.0-36.663.982.1-89.3Regulatory environment13.916.413.117.016.024.517.211.712.311.810.315.619.911.112.99.312.015.1from public or private entities in the last 6 months49.241.249.741.5--from private entities in the previous or current quarter----47.447.9from public entities in the previous or current quarter----12.716.656.262.070.261.059.541.60.0560.0560.0560.0560.0670.0501.61.21.00.80.70.81.21.31.30.80.50.910090.080.050.092.384.928.024.023.023.018.024.44644514446-2619111087.0SloveniaINDICATOR NAMEInvestment climateShortagesMaterial shortage, firms facing constraints, %1Labour shortage, firms facing constraints, %1Vacancy rate, vacant posts as a % of all available ones (vacant + occupied)2InfrastructureTransport infrastructure as an obstacle to investment, % of firms reporting it as a major obstacle3VHCN coverage, %4FTTP coverage, %45G coverage, %4Reduction of regulatory and administrative barriersImpact of regulation on long-term investment, % firms reporting business regulation as a major obstacle3Late paymentsPayment gap - corporates B2B, difference in days between offered and actual payment5Payment gap - public sector, difference in days between offered and actual payment5Share of SMEs experiencing late payments, %*6Single MarketIntegrationEU trade integration, % (Average intra-EU imports + average intra EU exports)/GDP2EEA Services Trade Restrictiveness Index7ComplianceTransposition deficit, % of all directives not transposed8Conformity deficit, % of all directives transposed incorrectly8SOLVIT, % resolution rate per country8Number of pending infringement proceedings8Competition and transparency in public procurementSingle bids, % of total contractors**8Direct awards, %**8Public procurement 
 
 
 
 
      
 
ANNEX 5: CAPITAL MARKETS, FINANCIAL STABILITY AND ACCESS TO FINANCE 

Slovenia’s banking sector has performed well 
thanks to improving asset quality and a rise 
in net interest income. The Bank of Slovenia has 
introduced  several 
important  macroprudential 
Insurance  premiums  dropped  but 
measures. 
profitability  and  solvency  improved  due  to  the 
abolition  of  complementary  health  insurance.  The 
protection  gap  for  earthquake  and  flood 
is 
significant. Firms in Slovenia rely on funding from 
banks  rather  than  on  funding  from  capital 
markets. Like in most Member States, households 
in  Slovenia  do  not  invest  enough  in  financial 
assets and, more importantly, equity. The gap with 
US  households  is  massive.  It  partly  explains  why 
Slovenia, like the EU in general, lags behind the US 
on access to finance, capital markets development, 
and 
innovation, 
competitiveness, 
geopolitical  power.  Encouraging  the  build-up  of 
universal  funded  supplementary  pension  schemes 
would positively contribute to (i) the sustainability 
and  adequacy  of  pension  benefits;  (ii)  investment 
in equity; (iii) access to finance; (iv) growth; and (v) 
innovation. 

growth 

Availability and use of domestic 
savings 

in 

ratio,  net  of 

The  Slovenian  economy  is  a  net  creditor  to 
the  rest  of  the  world.  In  the  last  decade,  the 
private  savings 
fixed  capital 
consumption,  persistently  fluctuated  around  its 
ten-year  average  of  8.3%  of  GDP,  reaching  a 
maximum of 15.7% in 2020 (see Graph A5.1). The 
net  private  investment  ratio,  which  measures  the 
net  contribution  of  the  private  sector  to  capital 
accumulation 
the  country,  evolved  quite 
differentely.  It  exhibited  a  ten-year  average  of 
0.9% of GDP, with a phase of negative investment 
from  2011  to  2016  followed  by  a  phase  of 
positive  investment  until  now.  During  the  same 
period  the  government  budget  was  in  regular 
deficit (except in 2017-2019) that averaged 2.6% 
of  GDP  with  a  peak  at  11.2%  of  GDP  in  2013 
(banks’  bail-out).  Thus,  the  high  positive  balance 
between net domestic savings and net investment, 
together  with  the  moderate  government  deficits, 
resulted  in  structural  net  lending  by  Slovenia  to 
foreigners (except in 2022) that averaged 4.7% of 
GDP, with a peak of 7.2% of GDP in 2020. 

Graph A5.1: Net savings-investment balance in 
Slovenia 

Source: AMECO. 

Consistent  with  its  regular  position  of  a  net 
creditor  to  the  rest  of  the  world,  the 
Slovenian  economy  has  exhibited  a  positive 
and  steadily 
international 
improving  net 
investment  position  since  2023.  As  of  Q3-
2024, total assets on foreigners reached 131% of 
GDP,  while  liabilities  to  foreigners  stood  at  125% 
of GDP, resulting in a net international investment 
position (NIIP) equivalent to 5% of GDP (see Graph 
A5.2). While significantly negative in 2017 (-25%), 
the  NIIP  has  steadily  improved  and  it  became 
in  2023.  The 
positive 
accumulated  net  portfolio  investments  and  other 
investments,  which  each  reached  11%  of  GDP  as 
of  Q3-2024,  accounted  for  most  of  the  NIIP.  In 
contrast,  net  foreign  direct  investments  were 
significantly  negative  (-20%  of  GDP).  Thus,  while 
the  Slovenian  economy  is  a  major  recipient  of 
foreign direct investment, it has recently become a 
net capital exporter, notably by means of portfolio 
and other investments abroad. 

time 

first 

the 

for 

Graph A5.2: International investment position of 
Slovenia 

Source: ECB. 

47 

-10-5051015202530352017201820192020202120222023% of GDPPrivate investment, netLending to the governmentPrivate saving, netPrivate saving, grossBorrowing from the rest of the world-200-150-100-5005010015020172018201920202021202220232024-Q3% of GDPForeign Direct Investment, AssetsPortfolio Investment, AssetsOther investment, AssetsOfficial reserve assetsForeign Direct Investment, LiabilitiesPortfolio Investment, LiabilitiesOther investment, LiabilitiesNIIP 
 
  
  
 
Structure of the capital markets and 
size of the financial sector 

The Slovenian domestic capital  market lacks 
depth. The market capitalisation of listed equity is 
quite  modest  and  reached  only  14%  of  GDP  at 
end-2023  (vs  67%  in  the  EU)  (see  Graph  A5.3). 
The  outstanding  volume  of  debt  securities is very 
low as well and reached 61% of GDP at end-2023. 
Bonds  issued  by  the  government  accounted  for 
90% of the total. This reflects the very high weight 
of  the  gross  public  debt  in  the  Slovenian  bond 
market. 

Graph A5.3: Capital markets and financial 
intermediaries in Slovenia 

Source: ECB, EIOPA, AMECO. 

The Slovenian banking sector is much smaller 
today than it was before the global financial 
crisis  and  the  sovereign  debt  crisis.  Banks’ 
assets  represented  83%  of  GDP  in  Q3-2024  (vs. 
248%  in  the  EU),  one  of  the  lowest  in  the  EU, 
sharply down from 150% in 2012. The two crises 
had a dramatic impact on the banking sector: they 
drove the corporate non-performing loans ratio of 
several  domestic  banks  beyond  30%  and  forced 
the  government  to  bail  out  the  three  largest 
domestic  banks  (NLB,  NKBM  and  Abanka)  and  to 
bail out or liquidate a few others. This resulted in a 
massive  deleveraging  and  downsizing  of  the 
banking 
significant 
consolidation  phase.  Abanka  and  Banka  Celje 
merged  in  2014,  followed  by  the  even  bigger 
merger of NKBM with Abanka in 2020 to form the 
second  largest  bank  in  the  country,  quite  far 
behind  NLB.  At  the  end  of  2023,  the  banking 
sector was dominated by the state-controlled NLB 
(44%  of  market  share  in  terms  of  total  assets), 

followed  by  a 

sector, 

followed  by  Hungarian  OTP-owned  NKBM  (18% 
market  share)  and  SKB  (8%),  in  the  process  of 
being merged with NKBM, and the two subsidiaries 
of  the  Italian  Intesa  Sanpaolo  (7%)  and  Unicredit 
(6%).  Foreign-owned  banks  represented  about 
48%  of  the  assets  of  the  banking  sector in  2023 
compared with the 30% that prevailed before the 
sovereign  crisis  of  2013  and  the  subsequent  sale 
of NKBM, Abanka and Banka Celje to Apollo-EBRD 
by the state. Most banks are privately owned, with 
the  notable  exception  of  the  largest  bank  NLB 
which  is  still  owned  by  the  state  at  25%  and 
therefore effectively controlled by it. The insurance 
sector,  with  total  assets  of  14%  of  GDP  at  Q3-
2024,  dominates  non-bank  intermediation  but 
much  below  the  EU  average  (55%  of  GDP).  The 
pension funds’ assets are much smaller: they only 
represent  3%  of  GDP  (vs  23%  in  the  EU). 
Investment  funds  represent  a  relatively  small 
share of 7.3% of GDP, below the EU median. 

Resilience of the banking sector 

Slovenia’s banking sector has performed well 
thanks to improving asset quality and a rise 
in  net  interest  income.  Return  on  equity  has 
constantly  exceeded  9%  since  2017,  and  reached 
a  record  high  of  16.8%  in  2023  (vs  9.0%  in  the 
EU)  and  16.2%  in  2024  (vs  10.0%  in  the  EU), 
mainly  thanks  to  an  increase  in  net  interest 
income  and  low  impairments.  However,  the  new 
temporary banking tax adopted in December 2023 
would  amount  to  0.2%  of  banks’  total  assets 
(which is equivalent to about 0.19% of GDP). This 
could  significantly  reduce  banks’  future  profits 
from  2024  to  2028.  The  capital  adequacy  ratio 
has  slightly  decreased  from  20.4%  in  December 
2023  to  19.7%  in  September  2024  (vs  20.1%  in 
the  EU).  The  average  Minimum  Requirement  for 
own  funds  and  Eligible  Liabilities  (MREL)  level  of 
Slovenian  banks  stood  at  35.1%  of  Total  Risk 
Exposure Amount (TREA) in December 2023, down 
from  36.1%  of  TREA  in  June  2023.  Against  an 
average  MREL  binding  target  (including  combined 
buffer requirements, CBR) as of 1 January 2024 of 
30.0% TREA, less than three banks present a MREL 
shortfall.  In  the  meantime,  Slovenia  has  not  yet 
published 
its  national  bail-in 
mechanic  in  line  with  EBA  guidelines.  The  non-
performing-loan  ratio  has  slightly  increased  from 
a record low of 1.5% in December 2023 to 1.6% in 
September 2024 (vs 1.9% in the EU). With a loan-
to-deposit  ratio  of  72.2%  (vs  95.5%  in  the  EU), 

information  on 

48 

Non-financial corporationsFinancial corporationsNon-financial corporationsMFIsInsurance  and pension fundsOther financialsGovernmentMFIsPension fundsInsurance corporationsInvestment funds0102030405060708090Listed equity                  Bonds                        Assets by sector% of GDP 
  
banks  benefit  from  a  substantial  excess  of 
deposits  over  loans.  This  ensures  a  relatively 
stable  funding  basis  and  abundant 
liquidity, 
allowing banks to significantly reduce the share of 
funding  they  take  from  the  ECB  from  5.91%  in 
August  2021  to  0% in  August  2024.  The  liquidity 
coverage  ratio  slightly  decreased  from  305%  in 
December  2023  to  297%  in  September  2024. 
However,  this  generally  positive  outlook  could  be 
threatened  in  the  future  by  political  or  legal 
developments.  There  is  still  no  lasting  solution  to 
the  legacy  portfolio  of  loans  issued  by  Slovenian 
banks in Swiss francs, and adverse court rulings on 
this  issue  remain  a  real  possibility,  even  if  the 
issue only concerns a few banks. 

The Bank of Slovenia has introduced several 
important  macroprudential  measures.  On  22 
December  2023,  it  modified  the  countercyclical 
capital  buffer  framework  to  introduce  a  positive 
neutral countercyclical capital buffer rate of 1.0%, 
which  banks  had  to  meet  as  of  1  January  2025. 
This  aims  to  address  unpredictable  economic 
shocks  and  the  uncertainties  related  to  cyclical 
systemic  risks.  In  July  2023,  it  slightly  loosened 
the  existing  macroprudential 
restrictions  on 
household  lending,  which  impose  caps  on  loans 
maturity, 
loan-to-value  and  debt  service-to-
income  ratios.  The  goal  of  these  borrower-based 
measures 
improve  credit  underwriting 
standards.  Finally,  it  decided  on  23  November 
2023 to slightly reduce the systemic risk buffer on 
real estate residential exposures from 1% to 0.5% 
as of 1 January 2025 due to the observed cooling 
of  the  Slovenian  real  estate  market.  According  to 
the  Bank  of  Slovenia,  the  period  of  high  house 
price growth and high growth in housing loans in a 
context  of  high inflation  and  higher  interest  rates 
is coming to an end. 

to 

is 

Resilience of the non-bank financial 
intermediaries 

The insurance market is highly concentrated. 
It  is  dominated  by  Zavarovalnica  Triglav  (36%  of 
market share in terms of gross written premium in 
Q4  2023),  followed  by  Zavarovalnica  Sava  (24%) 
and  Generali  (15%).  Together,  these  companies 
controlled  75%  of  the  insurance  market  in  2024. 
The  first  two  insurers  gained  market  share,  while 
the  third  one  lost  market  share.  The  two  largest 
insurers,  which  are  also  the  only  two  reinsurers, 

49 

Triglav  and  Sava,  are  controlled  by  the  Slovenian 
state. 

health 

insurance, 

Insurance premiums dropped but profitability 
and  solvency  improved  due  to  the  abolition 
of  complementary  health  insurance.  Insurers’ 
gross written premium dropped by 12.3% between 
H1-2023  and  H1-2024  due  to  the  abolition  of 
although 
complementary 
individual  segments  recorded  growth:  non-life 
(excluding health) and life gross written premiums 
respectively  increased  by  10.8%  and  10.6%.  The 
non-life combined  ratio(93)  improved  from 96% in 
December 2023 to 89% in September 2024. Part 
of  the  improvement  is  due  to  the  abolition  of 
complementary  health  insurance  which  tended  to 
exhibit a higher combined ratio than other non-life 
insurance  segments  due  to  the  regulatory  cap 
imposed  on  its  premiums.  This  led  to  an  increase 
in insurers’ profit from EUR 7.9 million in H1-2023 
to  EUR 122 million  in  H1-2024.  Overall  capital 
adequacy improved from 247% in 2023 to 266% 
in 2024 (vs 247% in the EU). 

The protection gap for earthquake and flood 
is  significant.  EIOPA’s  dashboard  on  insurance 
protection  gap  for  natural  catastrophes  gives  a 
score  of  respectively  3.5  and  3.0  for 
the 
earthquake  and  flood  protection  gaps  on  a  scale 
from  0  (lowest  gap)  to  4  (highest  gap).  On  4-5 
August  2023,  Slovenia  experienced 
its  most 
catastrophic  natural  disaster  (flash  floods)  since 
independence,  with 
indirect 
damage estimated at EUR 10 billion (16% of GDP). 
Yet, the insurance penetration for earthquake and 
floods  remains  particularly  low,  between  0%  and 
25%. 

total  direct  and 

Sources of business funding and the 
role of banks 

Firms in Slovenia rely on funding from banks 
rather than on funding from capital markets. 
More specifically, at the end of 2023, bank finance 
through loans constituted 27.6% (vs 27.2% in the 
EU)  of  all  funding  sources  for  Slovenian  non-
financial  corporations  (NFCs),  while  listed  shares 

(93)  The combined ratio is equal to the sum of the incurred losses 
and expenses divided by the earned premiums. It is inversely 
related to profitability. 

 
 
and bonds represented only 7.4% (vs 23.8% in the 
EU)  of  funding  sources.  When  expressed  in  terms 
of GDP, the overall level of NFC funding was lower 
in  Slovenia  (122.7%  of  GDP)  than  in  the  EU 
(230.3%), see Graph A5.4. 

As  a  result,  Slovenian  businesses  depend 
more  on 
internal  financing  than  their 
European  peers.  According  to  the  2024  EIB 
Investment  Survey,  74%  of  investment  needs  of 
Slovenian  firms  are  covered  by  internal  funding, 
compared to an EU average of 66%. At the same 
time,  81%  of  Slovenian  firms  believe  that  their 
investment  activities  over  the  last  three  years 
were  about  the  right  amount,  in  line  with  the  EU 
average  (80%),  suggesting  that  there 
is  no 
material  financing  gap  relative  to  investment 
demand.  However,  this  may  not  be  the  case  for 
firms  with  no  or  limited  capacity  for  internal 
funding,  such  as  innovative  start-up  firms  (see 
further below). 

Graph A5.4: Composition of NFC funding as % of 
GDP 

and 

small 

1.5%  for  housing  loans.  Between  June  2022  and 
November  2023,  interest  rates  on  new  loans  to 
households 
and  medium-sized 
enterprises (SMEs) soared by around 4 percentage 
points  to  levels  unseen  since  2008.  In  December 
2023,  interest  rates  on  new  loans  to  households 
for  house  purchases  at  variable  rates  reached  a 
peak  at  5.80%,  before  slightly  decreasing  to 
5.75% in April 2024 (vs 4.82% in the euro area). In 
parallel,  interest  rates  on  new  loans  to  SMEs 
reached  their  maximum  of  5.62%  in  October 
2023,  before  slightly  decreasing  to  5.22%  (vs 
5.30% in the euro area) in April 2024. 

that 

Banks  reported  no  change  in  their  credit 
standards  for  non-financial  corporate  loans 
in  Q2-2024  and  a  slight  loosening  in  credit 
standards for loans to households for house 
purchases. In the July 2024 Bank Lending Survey, 
Slovenian  banks 
their  credit 
indicated 
standards for non-financial corporate loans in Q2-
2024  remained  stable  for  the  fourth  consecutive 
quarter  since  Q3-2023.  Banks  reported  a  slight 
loosening 
to 
in  credit  standards  for 
households  for  house  purchases  in  Q2-2024, 
mainly  due  to  bank  competition  and  general 
economic  activity,  while  euro  area  banks  reported 
a  moderate  loosening.  Firms’  net  demand  for 
corporate  loans  continued  to  fall  in  Q2-2024  for 
the  eighth  consecutive  quarter,  although  the 
decline  is  less  than  during  the  previous  quarters. 
Housing loan demand slightly increased in Q1 and 
Q2-2024  after  six  consecutive  quarters  of 
substantial decrease. 

loans 

(1) Reference period 2023 
Source: Eurostat 

Capital markets and the participation 
of retail investors 

Credit  growth  has  fallen  due  to 
less 
attractive lending conditions. Due to the rise in 
interest  rates,  year-on-year  growth  of  credit  to 
NFCs  has  plunged  since  its  peak  of  August  2022 
and  turned  deeply  negative  to  reach  -6.9%  in 
January  2024,  a  level  unseen  since  the  credit 
crunch  observed  as  a  result  of  the  Slovenian 
banking  crisis  of  2013.  The  growth  rate  slightly 
increased  to  -5.2%  in  April  2024  (vs  0.2%  in  the 
euro  area).  Lending  to  households  held  up  much 
better with year-on-year growth of 5.1% (vs 0.2% 
in the euro area) in April 2024, steadily picking up 
after  having  bottomed  out  at  3.4%  in  October 
2023.  It  was  mainly  driven  by  a  huge  increase  in 
consumer  lending  by  15.8%,  as  opposed  to  only 

Slovenia’s  capital  markets  are  under-
developed.  The  main  stock  exchange  in  Slovenia 
is the Ljubljana Stock Exchange. The equity market 
is  very  small  in  terms  of  capitalisation  (14.6%  of 
GDP  vs  an  EU  average  of  68%  as  of  end-2023) 
and  volumes  traded,  and  even  more  so  when 
compared  with  the  US  (170.4%).  The  market 
breadth  of  bond  markets  has  steadily  decreased 
since  2018  and  is  largely  below  the  EU  average 
(0.6 vs 1.5). The bid-ask spread on equity markets 
is much higher than the EU average (12.6 vs 1.6). 
The use of equity by SMEs is relatively quite high, 
as  21.3%  of  SMEs  indicated  in  the  2023  SAFE 

50 

050100150200250SIEU% of GDPLoansTrade credit and advancesBondsListed sharesUnlisted sharesOther equity 
  
survey 
compared to an EU average of 10.1% (94). 

that  equity  was 

relevant  for 

them, 

Some reforms are underway. The recovery and 
resilience  plan  included  two  reforms  aimed  at 
strengthening capital markets  in Slovenia, namely 
(i)  the  adoption  of  a  new  act  on  forms  of 
alternative 
the 
implementation  of  a  new  strategy  for  Slovenian 
capital  markets,  setting  out  specific measures  for 
further  development.  The  government  has  also 
been  working  on  a  law  on  individual  investment 
accounts.  

funds  and 

investment 

(ii) 

Graph A5.5: Composition of household financial 
assets per capita and as % of GDP 

(1) Reference period 2023 
Source: Eurostat 

Slovenian households do not invest enough in 
financial  assets  and,  more 
importantly, 
equity.  Slovenian  households’  financial  assets 
equated to 115.7% of GDP in 2023, less than the 
EU  average  (209.4%)  and  much  less  than  the  US 
(435%) (95).  Worse,  assets 
in  equity 
equated  to  only  53%  of  GDP,  below  the  EU 
average  (118%)  and  more  than  six  times  lower 
than  the  US  (334%).  Slovenian  households  invest 
relatively little  in investment funds, bonds, shares 
and  insurance  pension  funds,  while  allocating  a 
significant  portion  to  deposits,  which  generate 
much lower returns than equity. 

invested 

The  design  of  the  overall  pension  system  is 
not  geared  towards  equity  investment  and 
the development of capital markets. The pay-

(94)  Data  and  surveys  -  SAFE  -  European  Commission,  2023, 

Results by country, T27. 

(95)  US figures are from 2022. 

as-you-go  nature  of  the  public  pension  system 
means  that  only  the  supplementary  private 
schemes  invest  in  high-return  assets  like  equity. 
However,  the  supplementary  private  schemes  are 
not universal and accumulated rights often remain 
limited  for  those  covered.  As  a  result,  they  only 
contribute  to  a  moderate  extent  to  the  total 
pension  income  and  do  not  fully  foster  the 
development  of  capital  markets.  Encouraging  the 
funded  supplementary 
build-up  of  universal 
pension schemes would positively contribute to (i) 
the  sustainability  and  adequacy  of  pensions 
benefits;  (ii)  investment  in  equity;  (iii)  access  to 
finance; (iv) growth; and (v) innovation. 

The role of domestic institutional 
investors 

investment  portfolio  of  Slovenian 
The 
insurers 
is  mostly  composed  of  bond 
holdings. The Slovenian insurance sector, which is 
small by EU standards (14.4% of assets-to-GDP vs 
an  EU  average  of  55.3%),  invested  50.1%  of  its 
assets  in  bonds  in  Q2-2024  (compared  to  36.9% 
for  the  European  Economic  Area  as  a  whole)  (96). 
Government bonds (domestic at 23%) represented 
31.8%  of  the  portfolio  (vs  18.9%  in  the  EEA), 
investment  funds  26.3%  (vs  35.4%  in  the  EEA), 
corporate  bonds  18.4%  (vs  18.0%  in  the  EEA), 
equity  16.0%  (vs  15.9%  in  the  EEA),  cash  and 
deposits 2.1% (vs 3.7% in the EEA), and mortgage 
and loans 1.0% (vs 3.9% in the EEA). 

The  domestic  pension  fund  industry  has  an 
even  more  conservative  investment  profile, 
with  a  greater  focus  on  bonds,  and  in 
particular  corporate  bonds.  The  assets  of 
Slovenian  pension  funds  were  equivalent  to  6.3% 
of  GDP  and  bonds  accounted  for  65.6%  of  these 
assets  as  of  end-2023  (vs  35.2%  in  the  EEA). 
Corporate bonds represented 40.2% of the assets 
(vs  12.4%  in  the  EEA),  government  bonds  25.4% 
(vs  22.8% 
funds 
represented 17.3% of the assets (vs 37.9% in the 
EEA), equity 11.8% (vs 19.4% in the EEA) and cash 
and deposits 2.7% (vs 4.5% in the EEA). 

investment 

the  EEA), 

in 

The  participation  of  domestic  institutional 
investors  in  providing  funding  for  start-ups 

(96)  Source: EIOPA Insurance Statistics. 

51 

0501001502002500102030405060708090SIEUSIEUper capita (000 EUR) (lhs)% of GDP GDP (rhs)Currency and depositsInsurance and pension fundsInvestment fundsBondsListed sharesUnlisted sharesOther equityHH Debt (liability) 
  
 
 
and  venture  capital  investors  is  low.  A  2024 
paper by the think tank centre for European Policy 
Studies showed that, on average, pension funds in 
Croatia,  Slovenia  and  Slovakia  accounted  for  only 
6%  of  private  equity  and  venture  capital  funds 
raised annually between 2007-2023, a figure that 
falls far short of the 19% for the Baltic states or 
20% shares for Nordic Member States (97). 

The depth of available venture and 
growth capital 

The  domestic  venture  and  growth  capital 
market is not developed enough to meet the 
financing  needs  of  innovative  firms.  The 
average value of annual  private equity relative to 
nominal  GDP  went  up  from  0.06%  in  2015-2020 
to 0.32% in 2021-2023, but it is still much lower 
than the equivalent EU average (0.6%). Worse, the 
average  value  of  annual  venture  capital  has 
remained  negligible,  dropping  from  0.007%  of 
GDP  in  2015-2020  to  0.003%  of  GDP  in  2021-
2023  (vs  0.08%  in  the  EU).  Given  the  limited 
venture capital (VC) and private equity (PE) activity 
in  Slovenia,  there  is  a  financing  gap  for  early-
stage innovative firms in need of capital. 

There  are  some  policies  in  place  to  promote 
start-up funding. To address the low volumes of 
PE  and  VC,  on  23 March  2022,  Slovenia  adopted 
the Resolution on the Slovenian scientific research 
and  innovation  strategy  2030.  The  Slovenian 
recovery  and  resilience  plan  (RRP)  also  allocates 
EUR 143 million 
to  support  productivity  and 
innovation,  creating  a  more  business-friendly 
environment for investors. This includes reforms to 
the  business  environment,  facilitate 
enhance 
access to finance and foster cooperation between 
public and private research sectors. The Slovenian 
government 
support 
offers 
mechanisms  for  start-ups  and  SMEs  via  the 
Slovene  enterprise  fund  (SEF),  which  proposes 
grants,  loans  and  co-investment  opportunities,  or 
via  EU  funding,  which  is  used  for  small  scale 
incentives,  with  vouchers,  or  for  a  start-up 
consortium  to  improve  the  support  environment 
for  innovative  start-ups  through  services  like 
advisory support and mentoring. 

various 

also 

Financing the green transition 

Sustainable finance is not yet very developed 
in Slovenia, but some recent initiatives have 
shown  growing  awareness  of  the  sector’s 
potential.  The  share  of  green  bonds  in  the  total 
bonds  outstanding  has  gradually  increased  over 
time to reach 1.2%, significantly lower than the EA 
average  of  4.0%.  However,  more  recently,  the 
issuance of bonds with environmental,  social, and 
governance  objectives  as  a  share  of  total  bond 
issuance  plunged  to  2%  in  H1 2024  compared  to 
its  three-year  average  of  around  28% (98).  This 
large  drop  is  due  to  the  issuance  by  Slovenia  of 
of 
large 
EUR 1 billion  and  EUR 1.25 billion  in  June  2021 
and  January  2023  respectively.  Under  Slovenia’s 
sustainability  bond framework, the proceeds from 
the  sustainability  bonds  will  fund  government 
investments  that  will  contribute  positively  to  the 
country’s  environmental  and  social  goals.  On 
for 
27 June  2023, 
invested 
Reconstruction 
EUR 35 million in a senior preferred green bond as 
part  of  Nova  Ljubljanska  Banka’s  EUR 500 million 
public issuance. 

European  Bank 

sustainability 

Development 

sovereign 

bonds 

and 

the 

Financial literacy 

is  crucial 

Financial literacy in Slovenia is the highest in 
the  EU  according  to  survey  data.  Financial 
to  promote  retail-investor 
literacy 
in  capital  markets  but  also  to 
participation 
familiarise  SMEs  with  alternatives 
to  bank 
financing. The integration of financial literacy into 
the  Slovenian  education  system  aligns  with  the 
new  national  financial  education  programme 
adopted 
in  January  2025.  This  programme 
represents  a  systematic  effort  to  raise  financial 
level,  emphasising  the 
capability  at  national 
importance  of  financial  education  as  a  lifelong 
process. In addition to integrating financial literacy 
into  school  curricula,  Slovenia  has  also  taken 
several  other  initiatives.  It  has  been  working  on  a 
24-month  project  (supported  by  the  Commission) 
to analyse the financial literacy of Slovenians aged 
15  to  79.  The  project  aims  to  produce  a 

(97)  Source: Closing the gaping hole in the capital market for EU 

(98)  Source: AFME CMU Key Performance Indicators, Seventh 

start-ups – the role of pension funds – CEPS. 

Edition, November 2024. 

52 

 
 
 
Table A5.1:  Financial indicators 

(1) Annualised data 
Credit growth and pension funds EU data refer to the EA average 
Source: ECB, ESTAT, EIOPA, DG FISMA CMU Dashboard, AMECO 

benchmarking  report  and  develop  educational 
content,  including  a  self-assessment  tool  and  an 
interactive game, to reach all demographic groups. 
Slovenia has also launched a financial literacy for 
adults  project  (2022-2024),  which  focuses  on 
developing programmes tailored to adult learners, 
addressing  their  specific  financial  literacy  needs. 
Furthermore,  Slovenia  actively  participates 
in 
Global  Money  Week,  an  annual  event  promoting 
financial  education  among  children  and  young 
people.  Finally,  the  Bank  of  Slovenia  has  been 
organising  financial 
literacy  programmes  for 
several  years,  targeting  a  wide  audience.  It  is 
perhaps,  in part,  because of  all these  efforts  that 
financial  literacy  in  Slovenia  is  the  highest  in  the 
EU.  The  2023  Eurobarometer  survey (99)  shows 
that  27%  of  Slovenians  have  a  high  level  of 
financial  literacy,  61%  a  medium  level,  and  the 
remaining  12%  a  low  level,  compared  to  the  EU 
average  of  18%  for  high  literacy,  64%  for 
medium, and 18% for low. This leads to an overall 
financial  literacy  indicator  of  54.5,  the  highest  in 
the EU, vs an EU average score of 45.5. 

(99)  Source: Monitoring the level of financial literacy in the EU - 

July 2023 - Eurobarometer survey. 

53 

20172018201920202021202220232024-Q3EUTotal assets of MFIs (% of GDP)94.989.488.698.895.091.185.283.3248.4Common Equity Tier 1 ratio17.717.617.816.716.915.917.717.316.6Total capital adequacy ratio18.117.918.518.318.418.520.419.720.1Overall NPL ratio (% of all loans)9.26.03.43.02.11.81.51.61.9NPL (% loans to NFC-Non financial corporations)20.213.36.96.53.92.92.82.93.5NPL (% loans to HH-Households)3.93.02.42.52.52.11.81.82.2NPL-Non performing loans coverage ratio59.657.754.651.855.654.160.660.642.1Return on Equity19.110.710.311.39.513.316.816.210.0Loans to NFCs (% of GDP)21.820.219.319.518.418.915.915.330.0Loans to HHs (% of GDP)22.822.822.823.522.221.920.120.244.5NFC credit annual % growth1.70.22.8-1.15.712.7-5.0-3.40.8HH credit annual % growth7.26.86.10.75.27.73.76.00.7Stock market capitalisation (% of GDP)12.414.014.715.117.713.414.417.369.3Initial public offerings (% of GDP)--------0.05Market funding ratio34.034.032.232.030.327.728.7-49.6Private equity (% of GDP)0.050.050.040.040.820.120.02-0.41Venture capital (% of GDP)0.010.000.000.010.000.010.00-0.05Financial literacy (composite)------54.5-45.5Bonds (as % of HH financial assets)0.50.50.40.30.20.20.5-2.7Listed shares (as % of HH financial assets)3.33.03.23.44.13.33.7-4.8Investment funds (as % of HH financial assets)4.33.94.54.55.54.85.5-10.0Insurance/pension funds (as % of HH financial assets)16.015.014.914.113.412.512.2-27.8Total assets of all insurers (% of GDP)18.817.518.019.617.814.814.214.754.8Pension funds assets (% of GDP)-----6.56.37.123.41-34-1011-1718-2425-27Colours indicate performance ranking among 27 EU Member States.Banking sectorNon-banks sector 
 
 
  
 
ANNEX 6: EFFECTIVE INSTITUTIONAL FRAMEWORK 

Slovenia’s institutional framework influences 
its  competitiveness.  Trust  in  public  institutions 
remains low. Slovenia would benefit from stronger 
regulatory  governance  and  simplification.  It  has 
progressed 
in  the  provision  of  digital  public 
services, but further efforts are needed to increase 
their  use.  The  attractiveness  of 
the  public 
administration remains a challenge. 

Public perceptions 

Graph A6.1: Trust in justice, regional / local 
authorities and in government 

servants,  establishing  a  public  procurement 
academy  and  setting  up  a  single  digital  platform 
for regulatory activities, for all public authorities.  

Some measures at local level aim to improve 
the quality of local public administration. For 
example,  measures  have  been  taken  to  even  out 
administrative  units’  workload  across  the  country 
and  reduce  processing  times  (102).  Public  opening 
hours  have  been  harmonised  across  all 
administrative  units  and  regional  offices  of  the 
authorities (103). The government is also working on 
to  cover  municipalities’ 
providing  a  solution 
additional costs (104). 

Quality of legislation and regulatory 
simplification 

is 

in 

the 

is  below 

Performance  in  developing  and  evaluating 
the  EU  average. 
legislation 
Performance 
stakeholder 
stronger 
engagement than in ex  ante impact assessments. 
In  2024,  Slovenia  launched  an  application  for 
drafting  regulations,  but  assessment  of  their 
impact  on  different  sectors  is  not  yet  mandatory 
(105).  Moreover, 
impact  of  subordinate 
regulations  is  assessed  even  more  inconsistently. 
Performance  in  ex  post  evaluation  of  legislation 
shows  a  noticeable  gap  compared  to  the  EU 
average.  Despite  of  the  ambition  to  introduce 
systematic  policy  evaluation,  the  methodology, 
transparency,  oversight,  and  quality  controls  for 
to 
this 
strengthen 
central 
administration are still  to show results. There has 
been  a  significant  increase  in  civil  society´s 
participation  in  the  sessions  of  parliamentary 
working bodies and in written input to Parliament. 
However,  civil  society  organisations  still  reported 
concerns about their restricted operating space. 

(Graph  A6.2).  Efforts 

remain  weak 

analytical 

capacity 

in 

(102) Act on Measures to Optimise Certain Procedures at 

Administrative Units (Official Gazette of the Republic of 
Slovenia, No 62/24). 

(103) Amendment to the Decree on administrative operations. 

(1) EU-27 from 2019; EU-28 before 
Source: Standard Eurobarometer surveys 

Trust  in  public  institutions  is  below  the  EU 
average.  Trust  levels  have  fluctuated  over  the 
past decade. Trust in local authorities ranks higher 
than  trust  in  central  government,  while  trust  in 
justice  is  furthest  behind  the  EU  average  (Graph 
A4.1). Key aspects that can improve trust in public 
administration  are 
less  bureaucracy,  more 
transparency in decision-making and use of public 
money,  and  more  communication  with  citizens 
(100).  The  perceived  quality  of  government  has 
deteriorated slightly and stands just below the EU 
average 
this  backdrop,  public 
administration  reform  priorities  under  Slovenia’s 
recovery  and 
include 
resilience  plan 
providing  training  on  specific  IT  skills  for  civil 

(101).  Against 

(RRP) 

(100) Understanding Europeans’ views on reform needs - April 
2023 - - Eurobarometer survey, Country Fact Sheet. 

(104) 132nd regular session of the government of the Republic of 

Slovenia 

(101) Inforegio – European Quality of Government Index 

(105) Input from Slovenia for the 2025 Rule of Law Report. 

54 

00.10.20.30.40.50.60.7AutumnSpringAutumnSpringAutumnSpringAutumnSpringAutumnSpringAutumnSummerWinterSummerWinterSpringAutumnSpringAutumn2014201520162017201820192020202220232024Justice,  legal system EU27Justice,  legal system SIRegional or local public authorities EU27Regional or local public authorities SIGovernment  EU27Government  SI 
 
      
 
 
 
 
Table A6.1:  Slovenia. Selected indicators on administrative burden reduction and simplification 

(1) This table presents a subset of iREG indicators focusing on regulatory costs. The indicators refer to primary legislation. 
Source: OECD (2025), Regulatory Policy Outlook 2025 [https://doi.org/10.1787/56b60e39-en] and Better Regulation across the 
European Union 2025 (forthcoming). 

Graph A6.2: Indicators of Regulatory Policy and 
Governance (iREG) 

Source: OECD (2025), Regulatory Policy Outlook 2025 and 
Better Regulation across the European Union 2025 
(forthcoming). 

There  is  scope  to  further  strengthen  the 
mechanisms  for  simplifying  regulation  and 
identifying  administrative  burdens. 
The 
Ministry  of  Economy  prepares  regular  packages 
aiming 
costs  and 
administrative  burdens  for  business.  However, 
when  developing  legislation,  regulators  are  not 
required  to  identify  and  assess  the  impact  of  the 
baseline  or  “do  nothing”  option,  to  identify  and 

compliance 

simplify 

to 

assess  the  impact  of  alternative  non-regulatory 
options  or  to  assess  the  level  of  compliance. 
Requirements 
to  conduct  periodic  ex  post 
evaluation of existing regulations and to assess in 
those  administrative  burdens  and  substantive 
compliance  costs  apply  to  some  (not  all)  primary 
laws (table A6.1).  

The  OECD  product  market  regulation  (PMR) 
indicator  shows  that  Slovenia’s  licensing 
system  is  less  burdensome  than  the  EU 
average. However, there is some room for further 
alignment  with  best  practices.  For  example,  while 
the  government  keeps  an  up-to-date  online 
licences 
inventory  of  all 
required/issued  to  businesses  by  public  bodies, 
there  is  no  requirement  for  the  government  to 
regularly  review  it  and  assess  whether  such 
licences and permits are still required or should be 
withdrawn (see also Annex 4).  

the  permits  and 

Social dialogue 

in  policy 
Social  partners  are 
development 
in  Slovenia,  although  there 
have  been  some  disruptions.  Slovenia's 
tripartite  social  dialogue,  conducted  through  the 

involved 

55 

0.00.51.01.52.02.53.03.54.0Primary lawsSubordinateregulationsPrimary lawsSubordinateregulationsPrimary lawsSubordinateregulationsSI_StakeholderengagementSI_Regulatory ImpactAssessmentSI_Ex-post evaluation oflegislationMethodologySystematic adoptionTransparencyOversight and quality control2021EU-27Ex ante impact assessment of legislationEx post evaluation of legislationIdentify and assess the impacts of the baseline or ‘do nothing’ option.Is required to consider the consistency of regulations and address areas of duplication.Identify and assess the impacts of alternative non-regulatory options.Is required to contain an assessment of administrative burdens.Quantify administrative burdens of new regulations.Is required to contain an assessment of substantive compliance costs.Quantify substantial costs of compliance of new regulations.Compares the impact of the existing regulation to alternative options.Assess macroeconomic costs of new regulations. Periodic ex post evaluation of existing regulations is mandatory.Assess the level of compliance.Government uses stock-flow linkage rules when introducing new regulations (e.g., one-in one-out).Identify and assess potential enforcement mechanisms.A standing body has published an in-depth review of specific regulatory areas in the last 3 years.In the last 5 years, public stocktakes have invited businesses and citizens to assess the effectiveness, efficiency, and burdens of legislation.When developing new legislation, regulators are required to …Yes /  For all primary laws For major primary laws For some primary lawsNo / Never 
   
 
 
      
 
Table A6.2:  Digital Decade targets monitored by the Digital Economy and Society Index 

Source: State of the Digital Decade report 2024 

in 

policy 

development 

collective  agreements.  However, 

Economic  and  Social  Council  established  in  1994, 
represents the highest institutional  framework for 
engagement among employers' associations, trade 
the  government.  This  structure 
unions,  and 
involvement  of  social 
facilitates  significant 
partners 
and 
implementation.  Leadership  within  the  Council  is 
rotational,  with  each  group  nominating 
the 
president  on  an  annual  basis.  At  the  sectoral  and 
enterprise levels, social dialogue is operationalised 
through  trade  unions  and  employers'  associations 
via 
recent 
challenges  have  led  to  periodic  suspensions  of 
dialogue.  In  May  2021,  a  trade  union  exited  the 
process, citing inadequate involvement in Covid-19 
related  legislative  initiatives.  Further  disruptions 
employers’ 
occurred 
organisations  suspended  participation  due  to 
perceived  deficiencies  in  inclusive  policymaking. 
Dialogue resumed formally  in June 2024, marked 
by the signing of a Declaration on respecting and 
promoting social dialogue, which aims to expedite 
critical  reforms,  notably 
in  the  pension  and 
healthcare sectors, as outlined in the RRP. (106) 

July  2023  when 

in 

Digital public services 

Slovenia  has made progress in  the  provision 
of  public  services  online  (Table  A6.2).  It  is 
moving  towards  the  EU  average  for  digital  public 
services  for  citizens  and  is  very  close  to  the  EU 

average  for  digital  public  services  for  businesses. 
By contrast, access to electronic health records for 
citizens  is  above  the  EU  average  (with  a  score  of 
88 out of 100 versus 79). 

While  the  range  of  digital  public  services  is 
improving, their uptake is lagging behind. The 
share  of  e-government  users  has  slightly 
decreased  from  81%  to  78%  (107).  Moreover,  the 
share of eID users is below the EU average (36% 
vs 41%). However, Slovenia has not yet set up and 
notified  eID  schemes  for  legal  persons  under  the 
eIDAS  Regulation  (108).  This  means  that  Slovenian 
businesses  cannot  authenticate  themselves  to 
access  public  services  provided  by  other  Member 
States,  including  those  enabled  by  the  Once-Only 
Technical System (109). 

Slovenia  is  now  closer  to  being  ready  for 
seamless,  automated  exchange  of  authentic 
documents  and  data  across  the  EU.  It  has 
completed  its  first  transactions  using  the  Once-
Only  Technical  System,  part  of  the  EU  Single 
Digital  Gateway,  and  is  ready  to  roll  out  services 
for citizens and business (110). 

Many of the digital transformation measures 
in  the  Slovenian  RRP  are  focused  on  public 
services. These include removing obstacles to the 
provision  of  digital  public  services  and  processes 
and enlarging the scope of electronic procedures in 

(107) European Commission. Digital Decade 2024: Country reports 

(108) European Commission, eIDAS Dashboard. 

(106) For  an  analysis  of  the  involvement  of  Slovenia’s  social 
partners at national level in the European Semester and the 
Recovery  and  Resilience  Facility,  see  Eurofound  (2025), 
National-level  social  governance  of  the  European  Semester 
and the Recovery and Resilience Facility. 

(109) European Commission, The Once Only Principle System: A 

breakthrough for the EU’s Digital Single Market 

(110) European Commission, Once-Only Technical System 

Acceleratormeter.  

56 

Digital Decadetarget by 20302022202320242024EU-27Digitalisation of public services169717779100Score (0 to 100)20212022202320232030284838485100Score (0 to 100)202120222023202320303na808879100Score (0 to 100)20212022202320232030Digital public services for businessesAccess to e-health recordsSloveniaEU-27Digital public services for citizens 
 
 
 
  
 
administrative  processes.  Furthermore,  under  its 
cohesion  programme  for  2021-2027,  Slovenia  is 
investing in a project aimed at providing integrated 
and  user-friendly  public  services  for  businesses, 
citizens and public institutions (111). An AI semantic 
application  for  civil  servants  to  analyse  and 
process  large  documents  and  texts  is  under 
development (112). 

Graph A6.3: Participation rate of 25-64 year olds 
in adult learning (%) by occupation 

of 

the 

attractiveness 

The 
public 
administration  remains  a  challenge.  Selection 
procedures  for  top  civil  service  positions  continue 
to  attract  few  candidates,  one  of  the  deterrents 
being  the  possibility  of  dismissal  without  reason. 
In  2023,  a  single  application  was  received  in 
almost  50%  of  all  published  competitions  (114). 
Slovenia  does  not  apply  a  uniform  measure  of 
employee  satisfaction  in  public  administration. 
Internal  mobility  for  civil  servants, 
including 
senior-level  civil  servants,  is  possible  but  not 
encouraged or expected (115). 

for 

the 

of  Slovenia’s  RRP 

However, efforts have been made to improve 
working  conditions  for  civil  servants.  The 
2024  reform  of  the  public  pay  system,  a  central 
public 
part 
administration,  aims  to  make  the  system  more 
flexible  and  more  transparent  (116).  The  reform 
includes  a  new  pay  scale  and  a  method  for 
converting  existing  pay  grades,  to  be  phased  in 
over  a  period  of  three  years.  Slovenia  has  the 
highest  share  of  women  in  senior  management 
positions in the national administration at EU level, 
with 62.7% women (117). 

Source: European Commission, based on the Labour Force 
Survey 

Integrity 

Civil service  

Slovenia’s civil service has a very high share 
of  staff  with  higher  education  (113).  The 
participation rate of civil servants in adult learning 
is  also  high  (Graph  A6.3).  However,  individual 
learning  plans  are  not  developed  for  all  or  most 
public  employees.  Nevertheless,  the  country  is 
working  on  providing  flexible  upskilling  and 
reskilling  opportunities  for  civil  servants.  These 
opportunities  relate  to  entrepreneurial  and  digital 
skills,  better  anticipating  change  and  new  skills 
requirements based on labour market needs.  

(111) Project Smart Digital Public Services: 

https://www.gov.si/en/news/2024-04-22-eu-funding-for-
smart-digital-public-services/ 

(112)

https://nio.gov.si/en/products/semanticni%2Banalizator

%2Bbesedil 

(113) Eurostat. Labour Force Survey.  

and 

consider 

corruption 

prosecutions 

Companies 
to  be 
significant  and  a  problem  in  doing  business, 
but  there  were  some  improvements  in  the 
investigations, 
final 
judgments of corruption offences. In Slovenia, 
83%  of  companies  consider  that  corruption  is 
widespread  (EU  average  64%)  and  35%  consider 
that  corruption is  a problem  when doing business 
(EU  average  36%)  (118).  Moreover,  only  15%  of 
companies  believe  that  people  and  businesses 
caught 
senior  official  are 
appropriately  punished  (EU  average  31%)  (119).  In 

for  bribing  a 

(114) Civil Servants’ Council, 2023 Annual Report. 

(115) Government at a Glance 2023: Slovenia – OECD. 

(116) 122nd regular session of the government of the Republic of 

Slovenia | GOV.SI 

(117) National administrations: top two tiers of administrators by 
function of government - European Institute for Gender 
Equality. 

(118) Flash Eurobarometer 543 on businesses’ attitudes towards 

corruption in the EU (2024).   

(119) Ibid. 

57 

051015202530354045SIEU-27SIEU-27SIEU-27SIEU-272021202220232024Public administration and defence; compulsory social securityHigh-skilled occupationsMedium-skilled occupationsUnskilled occupationsArmed forcesTotal economy 
   
 
 
 
Justice 

The 
justice  system  generally  performs 
efficiently,  but  some  challenges  remain.  The 
estimated  time  to  resolve  civil  and  commercial 
cases at first instance slightly increased from 337 
in 2022 to 344 in 2023. As regards administrative 
cases,  the  estimated  time  length  at  first  instance 
increased  from  540  days in  2022 to  627  days  in 
2023.  The  quality  of  the  justice  system  is  quite 
advanced 
for  case 
in  courts.  Electronic 
management,  particularly 
communication  between  courts  and  the  parties 
involved  has  been  further  improved.  As  regards 
judicial  independence,  no  systemic  deficiencies 
have been reported.(127)  

regarding  digital 

tools 

transparency 

improved  and 

investigations  of  bribery 

2023  prosecutors  were  successful  in  obtaining 
convictions in cases involving high- or mid-ranking 
(120). 
officials  for  corruption-related  offences 
Detection  and 
in 
international business transactions remained weak 
throughout  2023  and  2024  (121).  The  length  of 
court  trials  of  money  laundering  and  corruption 
cases  is  a  challenge,  as  they  are  among  the 
longest  in  the  EU  (926  days  on  average  in  first 
instance money laundering cases in 2023, up from 
631  in  2022)  (122).  Moreover,  while  procedures 
have 
in  public 
procurement  has  increased,  a  risk  analysis  of 
corruption  and  conflicts  of 
the 
healthcare  sector  was  carried  out  and  risks  in 
public procurement persist (123). Furthermore, 34% 
of  companies  (EU  average  27%)  think  that 
corruption  has  prevented  them  from  winning  a 
public  tender  or  a  public  procurement  contract  in 
practice  in  the  last  three  years  (124).  The  National 
Review  Commission,  responsible  for  reviewing 
public  procurement  award  procedures,  indicated  a 
decline in the number of reviews it is carrying out, 
potentially  explained  by  increased  transparency 
public 
arising 
procurement procedures. Sectors identified at high 
risk  of  corruption  include  health,  decision-making 
in 
local  government,  spatial  planning  and 
environmental matters.(125)  

the  digitalisation 

interest 

from 

of 

in 

Slovenia  has  implemented  a  public  register 
for  lobbyists,  like  most  Member  States.  In 
2023,  the  Commission  for  the  Prevention  of 
Corruption  enforced  administrative  sanctions  for 
omission  of  reporting  on  18  registered  lobbyists 
(126).  

(120) See the 2024 country-specific chapter for Slovenia of the 

Rule of Law Report, pp. 14-15. 

(121) Ibid., p. 14. 

(122) See the upcoming 2025 EU Justice Scoreboard. 

(123) Ibid., pp. 20-21. 

(124) Flash Eurobarometer 543 on businesses’ attitudes towards 

corruption in the EU (2024).   

(125) See the 2024 country-specific chapter for Slovenia of the 

Rule of Law Report., pp. 20-21. 

(126) Ibid, pp. 17-18. 

(127) For more detailed analysis of the performance of the justice 
system  in  Slovenia,  see  the  upcoming  2025  EU  Justice 
Scoreboard and 2024 Rule of Law Report. 

58 

 
 
 
SUSTAINABILITY 
ANNEX 7: CLEAN INDUSTRY AND CLIMATE MITIGATION 

faces 

significant 

Slovenia 
challenges 
regarding  its  clean  industry  transition  and 
climate  mitigation.  It  is  a  competitive  exporter 
of  grid  technology  components  and  also  hosts 
battery  production  facilities.  It  is  implementing 
policies  to  strengthen  supply  chains  and  the 
uptake  of  circular  solutions  for  critical  raw 
materials  but 
remains  highly  dependent  on 
imports of raw materials from a limited number of 
sources,  with  the  circular  material  use  rate 
stagnating below the EU average. Slovenia has put 
in place policies to support the decarbonisation of 
industry,  but  more  is  needed.  Its  industry  still 
releases air and water pollutants, and the costs of 
pollution  remain  higher  than  the  investment  in 
pollution  prevention  and  control.  This  annex 
reviews  the  areas  in  need  of  urgent  attention  in 
Slovenia’s  clean  industry  transition  and  climate 
mitigation, looking at different dimensions. 

Strategic autonomy and technology 
for the green transition  

Net zero industry  

level  of 

opportunities 

industrialisation 
Slovenia’s  high 
provides 
the 
regarding 
manufacturing  of  net  zero  technologies, 
although  its  production  capacity  is  currently 
modest (128). For solar PV modules, it amounts to 
between  700  and  800  MW/y,  which  is  4%  of  the 
EU’s  capacity.  In  addition,  the  country  hosts  at 
least  five  battery  production  facilities,  including 
one  giga  factory  which  opened  in  2024,  and  at 
least six facilities producing heat pumps. Slovenia 
is  also  a  competitive  exporter  of  grid  technology 
components,  including  automatic  circuit  breakers, 
relays,  parts  of  electrical  boards,  devices  for 
protecting  electrical  circuits  and  liquid  dielectric 
transformers.  To  address  its  remaining  strong 
import dependency for components and machinery 
in  the  field  of  batteries  and  microelectronics, 
Slovenia participates in several Important Projects 
of  Common  European  Interest  (IPCEI)  related  to 
strategic technologies for Europe. It is part of the 
EuBatIn IPCEI, approved in 2021, and the IPCEI on 

(128) European Commission, 2025, The net-zero manufacturing 

industry landscape across the Member States, Op.europa.eu. 

59 

and 

microelectronics  (IPCEI  ME/CT)  and  the  IPCEI  on 
cloud 
communication/information 
technologies  (IPCEI  CIS).  Projects  in  IPCEI  ME/CT 
and IPCEI CIS are supported by Slovenia’s national 
recovery and resilience plan. 

The  absence  of  an  industrial  policy  on  net 
zero  industry  means  that  there  are  few 
signals  to  support  the  scale  up  of  net  zero 
manufacturing.  However,  the  need  to  ensure  a 
fair transition in Slovenia’s coal regions brings new 
economic  opportunities  through  investment  and 
skill transfers for net zero technologies, supported 
by the Just Transition Fund (129). This includes the 
Technology  Demonstration  and 
Carbon-Free 
Training  Centre  in  Zagorje  ob  Savi,  which  will 
develop and provide training for both students and 
experts in batteries, hydrogen and Carbon Capture 
and Storage (CCS) technologies. 

Transforming the car industry 

Similar  to  other  parts  of  Europe,  Slovenia’s 
automotive supplier industry is struggling for 
global competitiveness in the midst of the e-
vehicle  transformation.  Exports  of  products 
related to the automotive industry have decreased 
slightly  (130).  The  Slovenian  automotive  industry 
comprised  around  300  companies  in  2023  and 
provided around 16 900 jobs, with Germany by far 
being  the  biggest  export  market  for  this  sector 
(131),  which  means  that  difficulties  in  the  German 
market  also  impact  Slovenian  companies  in  the 
value chain. Weak demand for electric cars as well 
as  production  stops  further  impact  the  sector’s 
competitiveness  as  well  as  the  sustainable  travel 
transition in a country which has a very low share 
of  registered  electric  cars  (132).  As  a  result, 
industry  suppliers  have 
Slovenia’s  automotive 
started 
the  Chinese 
ties  with 
to  promote 
automotive  industry,  in  search  of  future  business 
opportunities. 

(129) European Commission, 2022, EU Cohesion Policy: More than 
EUR 258 million for a just climate transition in Slovenia, 
Ec.europa.eu. 

(130) Institute of Macroeconomic Analysis and Development, 
2025, Spring Forecast of Economic Trends, Umar.gov.si. 

(131) Slovenia Business, 2024, Automotive industry, 

Sloveniabusiness.eu. 

(132) European Environment Agency, 2024, Newly registered 

electric cars by country, 2024, Eea.europa.eu. 

 
 
 
 
 
 
 
Critical raw materials  

which defines the key goals and measures for the 
coordinate management of mineral resources (137).  

The  country  is  highly  dependent  on  imports 
of  raw  materials  from  a  limited  number  of 
sources,  with  Slovenia’s  import  concentration 
higher  than  the  EU  average.  The  country’s  import 
concentration for a basket of critical raw materials 
was 6th highest in the EU in 2023, just below the 
high-degree 
Furthermore, 
Slovenia’s  gross  operating  surplus  in  the  basic 
metals  manufacturing  sector  has  been  declining 
since  2017  (134).  The  majority  of  substances 
processed  in  Slovenia  are  minerals  and  metals 
(around  65%  in  total),  which  are  mostly  used  in 
the processing industry and construction (135).   

threshold. 

(133). 

Non-food,  non-fuel  raw  material  imports  are 
heavily  concentrated 
in  aluminium,  primarily 
sourced  from  Bosnia-Herzegovina,  with  additional 
supplies  from  Mozambique.  Slovenia  also  imports 
other  critical  or  strategic  minerals,  such  as 
phosphorus  (mainly  from  Morocco),  nickel  (mainly 
from Canada and Colombia), fluorspar from China, 
copper from Bosnia-Herzegovina and borates from 
Turkey.  With  41.5%  of  material  inputs  from 
imports in 2023 (EU  average: 22%) (136), Slovenia 
chain 
is  particularly  vulnerable 
disruptions. 

supply 

to 

is  preparing 

To  mitigate  such  vulnerabilities  and  to  help 
integrate  domestic  raw  material  supply  chains  in 
line with the European Union’s strategic objectives, 
Slovenia 
its  National  Research 
Programme.  It  will  identify  the  national  potential 
for  critical  raw  materials,  support  research  and 
innovation  in  the  field  of  sustainable  extraction 
and  processing.  As  mining  itself  faces  challenges 
regarding  coordination  and  permitting,  Slovenia 
also prepared an action plan to reduce the backlog 
of  permit  applications. 
in  2018, 
Slovenia  adopted  a  National  Mining  Strategy, 

In  addition, 

(133) European Commission, 2024, Single Market and 

Competitiveness Scoreboard, strategic dependencies on raw 
materials, Ec.europa.eu. 

The  circular  use  of  material  is  also  key  to 
reducing dependence on imports. In this regard, 
over  the  last  decade,  Slovenia’s  circular  material 
use  rate  has  stagnated,  remaining  below  the  EU 
average, with Slovenia’s resource productivity also 
considerably  below  the  average  (138).  This  creates 
significant  challenges  regarding  sustainability  and 
resilience, 
risks, 
environmental degradation and social concerns.  

supply 

chain 

such 

as 

is 

of 

industry 

policies 

Slovenian 

Slovenia 
to 
implementing 
strengthen  supply  chains  and  the  uptake  of 
circular  solutions  for  critical  raw  materials. 
The government is encouraging the de-risking and 
diversification 
by 
implementing  various  reforms.  These  include  the 
new  implementing  regulation  for  the  Investment 
Promotion  Act,  which  aims  to  speed  up  the 
transition  to  a  circular  economy  (and  therefore 
reduce  reliance  on  imports)  and  promote  the  use 
of recycled materials. And the government is also 
investing in research and innovation projects in the 
circular economy. In addition, the Slovenian centre 
for the circular economy was established in 2025. 
The  recycling  rate  for  e-waste,  a  key  source  of 
critical  raw  materials,  is  close  to  the  EU  average, 
with 81% in 2022. The reuse and recycling rate for 
end-of-life  vehicles  is  slightly  below  the  EU 
average  (86.7%  vs.  89%  in  2022).  This  points  to 
the need to avoid the loss of critical raw materials, 
notably  as  the  car  industry  shifts  to  battery 
electric- vehicles. 

Climate mitigation  

Industry decarbonisation 

it  contributes 

less  to  overall 
Although 
greenhouse  gas  emissions,  the  key  climate 
and  energy  characteristics  of  Slovenia’s 
manufacturing  sector  are  close  to  the  EU 
average. 17% of Slovenia's total greenhouse gas 

(134) European Commission, Raw Materials Information System, 

(137) Republic of Slovenia, 2018, National Mining Strategy, 

Country Profiles, Slovenia, Rmis.jrc.ec.europa.eu. 

Energetica-portal.si. 

(135) Institute of Macroeconomic Analysis and Development, 

(138) The European Environment Agency, 2024, Circular material 

2023, Productivity Report, Umar.gov.si. 

use rate by EU country 

(136) Material import dependency, Statistics | Eurostat 

60 

 
 
 
 
 
emissions 

emissions come from industry. With 260 g CO2eq 
per  euro  of  GVA,  the  country’s  manufacturing 
sector’s emissions intensity was just below the EU 
total,  270  g/€  (139).  Between  2017  and  2022,  the 
GHG 
Slovenia’s 
intensity 
manufacturing improved by 16%, less than the EU 
on  average  (20%).  A  major  share  of  Slovenia’s 
manufacturing  emissions  –  58%  –  come  from 
energy use; the remainder (42%) primarily relates 
to  industrial  processes  –  like  in  the  EU  overall, 
where these shares are 57% and 43%.  

of 

The  energy-related  greenhouse  emissions 
intensity  of  manufacturing  in  Slovenia  has 
seen  improvements,  in  line  with  improving 
energy  efficiency.  Between  2017  and  2022, 
energy-related  emissions  intensity  in  Slovenian 
manufacturing declined by 20%, more than the EU 
average  (16%)  (140).  In  parallel,  the  share  of 
renewables and electricity in manufacturing’s final 
energy  consumption  decreased  by  2  percentage 
points  to  47%  (the  EU  average  is  44%).  In  the 
meantime,  Slovenian  manufacturing  has  seen 
larger  improvements  in  energy  intensity,  with  a 
decline in the sector’s final energy consumption of 
21%,  from  1.6  to  1.3  GWh  per  euro  of  GVA 
produced  (albeit  still  higher  than  the  EU  average, 
1.1  GWh/€).  Concerning  industrial  processes  and 
product  use,  between  2017  and  2022,  the 
greenhouse  emissions 
these 
sources  in  Slovenian  manufacturing  declined  by 
18%, while a figure of 23% was registered in the 
EU overall.  

intensity 

from 

(139) In  2023.  Manufacturing  includes  all  divisions  of  the  “C” 
section  of  the  NACE  Rev.  2  statistical  classification  of 
economic  activities.  In  the  remainder  of  this  section,  unless 
indicated  otherwise,  data  on  manufacturing  refer  to  the 
divisions  of  the  NACE  section  C  excluding  division  C19 
(manufacture  of  coke  and  refined  petroleum  products),  and 
the  year  2022.  The  source  of  all  data  in  this  section  is 
Eurostat;  data  following  the  UNFCCC  Common  Reporting 
Framework (CRF) are from the European Environment Agency 
(EEA), republished by Eurostat. 

(140) For the GHG emissions intensity of GVA related to energy use 
and  industrial  processes  and  product  use  respectively,  GHG 
emissions  are  from  inventory  data  in  line  with  the  UNFCCC 
Common  Reporting  Format  (CRF),  notably  referring  to  the 
source sectors CRF1.A.2 –  fuel combustion in manufacturing 
industries  and  construction  and  CRF2  –  industrial  processes 
and  product  use.  The  CRF1.A.2  data  broadly  correspond  to 
the NACE C and E sectors, excluding C-19. GVA data (in the 
denominator  for  both  intensities)  are  aligned  with  this 
sectoral  coverage.  Therefore,  they  are  not  fully  consistent 
with the data referred to in other part of this section. 

61 

Graph A7.1: GHG emission intensity of manu-
facturing and energy-intensive sectors, 2022 

Source: Eurostat. 

of 

gas 

paper 

Slovenian 

industries 

greenhouse 
Energy-intensive 

Slovenia’s  paper  manufacturing  sector  is 
emissions 
particularly 
(141) 
intensive. 
account for 13% of Slovenia’s total manufacturing 
gross  value  added  (2022).  Among  these,  with 
2.4 kg CO2eq  per  euro  of  GVA,  the  emissions 
(products) 
intensity 
manufacture  is  the  highest  in  the  EU,  more  than 
three  times  the  EU  average  of  0.7 kg/€. 
In 
contrast,  the  manufacture  of  basic  metals  and 
chemicals,  both  more  important  economically  in 
Slovenia,  recorded  a  relatively  low  emissions 
intensity,  with  0.3  and  1.3 kg CO2eq/€  of  GVA, 
below the respective EU averages. As an important 
component  of  the  production  costs  in  the  above 
industries  and  others,  electricity  prices  have 
remained slightly above the EU average lately (142).  

Slovenia has put in place policies to support 
the  decarbonisation  of  industry,  but  more  is 
needed.  It  has  implemented  measures  such  as 
investment  via  the  climate  change  fund,  financed 
from  revenues  from  the  EU  Emissions  Trading 
Scheme (ETS), and has further plans to implement 
financial incentives, including for energy efficiency 
and  carbon  capture,  transport  and  use  projects  in 
hard-to-decarbonise  sectors.  Its  economy  would 
benefit  from  further  measures,  such  as  the 

(141) Notably,  the  manufacture  of  paper  and  paper  products 
(NACE  division  C17),  of  chemicals  and  chemical  products 
(C20),  “other”  non-metallic  mineral  products  (C23;  this 
division includes manufacturing activities related to a single 
substance of mineral origin, such as glass, ceramic products, 
tiles,  and  cement  and  plaster),  and  basic  metals  (C24).  To 
date,  these  industries  are  energy-intensive  –  i.e.  consuming 
much  energy  both  on  site  and/or  in  the  form  of  purchased 
electricity  –  and  greenhouse  gas  emissions  intensive,  in 
various combinations. 

(142) For a detailed analysis of energy prices, see Annex 8 on the 

affordable energy transition. 

00.511.522.533.54C-C19C17C20C23C24KG CO2eq / €SloveniaEU-27 
 
  
 
promotion  of  new 
low  carbon-  technologies 
including  hydrogen  (e.g.  under  the  EU  Innovation 
Fund), measures to increase energy efficiency (e.g. 
under  the  EU’s  ETS  Modernisation  Fund),  and  the 
promotion of circular economy practices. 

Reduction  of  emissions  in  the  effort  sharing 
sectors 

(143). 

To  attain  its  2030  effort  sharing  target, 
Slovenia  needs 
to  swiftly  adopt  and 
implement  its  planned  climate  mitigation 
In  2023,  greenhouse  gas 
measures 
emissions  from  Slovenia’s  effort  sharing  sectors 
are  expected  to  have  been  15%  below  those  of 
2005. If implemented, by 2030, additional policies 
considered  in  Slovenia’s  final  updated  national 
energy  and  climate  plan  (NECP)  are  projected  to 
reduce them by 28.6% relative to 2005 levels (144), 
meaning  that  Slovenia  would  overachieve  its 
effort sharing target – a reduction of 27% – by 1.6 
percentage  points.  Given  the  large  impact  of  the 
additional measures that are not yet implemented, 
swift  and  steady  adoption  will  be  critical  for  the 
implementation of the full set of measures. 

Graph A7.2: Greenhouse gas emissions in the 
effort sharing sectors, 2005 and 2023 

Source: European Environment Agency 

Swift  action  on  decarbonising  transport 
appears  particularly  necessary  in  Slovenia. 
Between  2005  and  2023,  greenhouse  gas 
emissions  from  road  transport  increased  by  20% 
in Slovenia, while they decreased by 5% in the EU 
overall.  Speeding  up  climate  mitigation  in  these 
sectors would help protect households, businesses 
and transport users in Slovenia from the impact of 
carbon pricing.  

Sustainable industry 

Circular economy transition 

in  Regulation 

(143) The national greenhouse gas emission reduction target is set 
out 
(the  Effort  Sharing 
(EU)  2023/857 
Regulation).  It  applies  jointly  to  buildings  (heating  and 
cooling); road transport, agriculture; waste; and small industry 
(known as the effort sharing sectors). 

(144) The  effort  sharing  emissions  for  2023  are  based  on 
inventory  data.  The  final  data  will  be 
approximated 
established 
review. 
Projections are based on the impact of current policies (“with 
existing  measures”,  WEM)  and  additional  policies  (“with 
additional measures”, WAM), as per Slovenia’s final updated 
NECP. 

in  2027  after  a  comprehensive 

There 
is  room  for  boosting  Slovenia’s 
in  2023, 
circularity  transition.  At  8.8% 
Slovenia’s  circular  material  use  is  still  below  the 
EU average. Resource productivity, too, was below 
the  EU  average  in  2023, with  EUR  1.38  per  kg  of 
resource 
material 
productivity has been stable over the past decade, 
with  a  slight  decrease  in 2023;  greater  efforts  to 
it  would  help  minimise  negative 
increase 
environmental impacts and reduce dependence on 
volatile raw material markets. 

consumed. 

Slovenia’s 

Slovenia is regularly implementing policies to 
increase  circularity,  for  example  by  introducing 
its  comprehensive  circular  economy  roadmap  in 
2018  as 
for  circular  economy 
transition (145).  Slovenia  is  using  its  recovery  and 

the  basis 

(145) Roadmap towards the Circular Economy in Slovenia, 2018. 

62 

0246810121420052023MtCO2eDomestic transport (excl. aviation)Buildings (under ESR)AgricultureSmall industryWaste 
 
      
 
for 

Sustainable 

resilience plan (RRP) to support the transition to a 
low  carbon  and  circular  economy  and  to  increase 
In  this  context,  a  new 
material  productivity. 
Framework 
Green 
Transformation  will  improve  Extended  Producer 
the 
Responsibility 
integration of secondary raw materials. The reform 
also  established  a  one-stop  shop  to  support 
businesses, in particular SMEs, in their transition to 
a circular economy.   

schemes 

promote 

and 

and 

Slovenia 
in  waste 
is  a  top  performer 
management  and  produces  less  waste  than 
the  EU  average.  With  a  recycling  rate  of  63%, 
Slovenia ranked high in the EU for municipal waste 
recycling in 2022. It is on track to meet the 2025 
recycling and 2035 landfilling targets. In 2022, at 
51%  its  recycling  rate  for  plastic  packaging  was 
above 
In  2022,  71%  of 
construction  and  demolition  waste  was  recycled, 
excluding  backfilling  –  below  the  EU  average, 
79.8%.  Despite  good  performance 
in  waste 
recycling, Slovenia has a high material footprint  – 
22.8  tonnes  per  capita  –  more  than  the  EU 
average of 14 tonnes in 2023. 

the  EU  average. 

in 

the 

investment 

Current 
circularity 
transition  is  not  yet  sufficient.  Slovenia  is 
estimated  to  need  total  additional  investment 
worth  at  least  EUR  108  million  per  year  for  the 
transition,  including  waste  management.  Of  the 
circular  economy  investment  gap  to  attain  policy 
targets that are not yet budgeted, EUR 23 million 
relate to recent initiatives on the circular economy, 
such  as  eco-design  for  sustainable  products, 
packaging waste, labelling and digital tools, critical 
raw  materials  recycling  and  measures  proposed 
under  the  amended  Waste  Framework  Directive.  
An  additional  EUR  65  million  is  needed  to  unlock 
Slovenia’s circular economy potential (146). 

Zero pollution industry 

Slovenia  has  been  making  considerable 
progress  in  reducing  air  pollution,  which  is 
now  decoupled  from  GDP  growth.  The  2020-
-2029  emissions  reduction  commitments  under 
the National Air Pollution Control Programme have 
been  met,  and  the  commitments  for  2030  are 
In  2023,  no 
projected  to  be  met  as  well. 

exceedances  above  the  limits  set  by  the  Ambient 
Air  Quality  (AAQ)  Directive  were  registered  in 
Slovenia.  However,  in  two  air  quality  zones  the 
target  values  for  ozone  concentrations  have  not 
been  met.  Furthermore,  decreasing  trends 
in 
2020-2022  have  slowed  or  stopped  for  nitrogen 
oxide  (NOx)  and  particulate  matter  (PM2.5).  The 
main NOx polluter is road transport (cars).   

for  NOX 

emissions, 

in  damage 

to  health  and 

Slovenia’s  industry  still  releases  air  and 
water  pollutants.  Concerning  air  pollution,  with 
EUR  26.4 
the 
environment  per  thousand  EUR  of  GVA,  the 
emissions  intensity  of  Slovenian  industry  is  just 
below  the  EU  average  (27.5  EUR).  Nevertheless, 
most emissions into the air come from the mineral 
the  waste 
industry 
management  and  chemical 
industry  for  dust 
emissions,  the  energy  sector,  the  metals  sector 
and  the  mineral  sector  for  SO2  and  heavy  metals. 
Concerning  water  pollution,  Slovenia  has  the  8th 
lowest  absolute  amount  of  emissions  of  heavy 
metals into water in the EU. Furthermore, with EUR 
0.21 in damage to health and the environment per 
billion EUR of GVA, its emissions intensity is below 
the  EU  average.  Key  emitters  into  water  are  the 
chemical  industry  for  heavy  metals,  nitrogen  and 
total organic carbon; the manufacture of pulp and 
paper for organic carbon, and the metal production 
and  processing  sector  for  polycyclic  aromatic 
hydrocarbons (PAHs). 

The costs of pollution remain higher than the 
investment 
in  pollution  prevention  and 
control.  For  2022,  about  1 300  deaths  per  year 
were  attributed  to  fine  particulate matter  (PM2.5) 
pollution; 140 deaths to nitrogen dioxide, and 340 
to  ozone (147).  The  costs  from  all  pollutants  are 
estimated  to  be  EUR  403  million (148).  In  contrast, 
to meet its objectives for pollution prevention and 
control and address the health and economic costs 
of pollution, Slovenia needs an additional EUR 55  

(147) EEA, 2024, Harm to human health from air pollution in 

Europe: burden of disease status, 2024. In terms of years of 
life lost, this implies 13 300 years for PM2.5, 1 400 for NO2, 
and 3 600 for O3. 

(146) European Commission, DG Environment, Environmental 

investment needs & gaps assessment programme, 2025 
update. Expressed in 2022 prices. 

(148) For 2021, value of statistical life method. Source: EEA, 
2024, The costs to health and the environment from 
industrial air pollution in Europe – 2024 update. 

63 

 
 
 
Table A7.1:  Key clean industry and climate mitigation indicators: Slovenia 

Source:  Net zero industry: European Commission: The net-zero manufacturing industry landscape across Member States: final 
report, 2025. Automotive industry transformation: Eurostat. Critical raw materials: Eurostat. Climate mitigation: See 
footnotes in the "climate mitigation" section; reduction of effort sharing emissions: EEA greenhouse gases data viewer; European 
Commission, Climate Action Progress Report, 2024. Sustainable industry: Years of life lost due to PM2.5: Eurostat and EEA, 
Harm to human health from air pollution in Europe: burden of disease status, 2024. Air pollution damage: EEA, EU large industry 
air pollution damage costs intensity, 2024. Emissions covered: As, benzene, Cd, Cr, Hg, NH3, Ni, NMVOC, NOX, Pb, dioxins, PM10, 
PAH, SOX. Water pollution intensity: EEA, EU large industry water pollution intensity, 2024. Releases into water covered from 
cadmium, lead, mercury, nickel. Other indicators: Eurostat. 

million per year (0.09% of GDP), mostly related to 
clean air and noise (149). 

(149) European Commission, DG Environment, Environmental 

investment needs & gaps assessment programme, 2025 
update. Expressed in 2022 prices. 

64 

Strategic autonomy and technology for the green transitionNet zero industryOperational manufacturing capacity 2023- Solar PV (c: cell, w: wafer, m: module), MW700-800 (m)- Electrolyzer, MW-- Wind (b: blade, t: turbine, n: nacelle), MW-- battery, MWh-Automotive industry transformation201720182019202020212022202320182021Motorisation rate (passenger cars per 1000 inhabitants), %541549556555564571579539561New zero-emission vehicles, electricity motor, %0.410.700.963.223.265.028.891.038.96Critical raw materials201720182019202020212022202320182021Material import dependency, %46.848.046.245.346.541.524.222.6Climate mitigationTrendIndustry decarbonisation201720182019202020212022202320172022GHG emissions intensity of manufacturing production, kg/€0.310.310.290.280.270.260.240.340.27Share of energy-related emissions in industrial GHG emissions40.840.940.140.840.439.441.544.842.5Energy-related GHG emissions intensity of manufacturing155.0156.4142.3141.4132.5124.0-158.4132.9and construction, kg/€Share of electricity and renewables in final energy consumption49.448.048.347.547.047.246.043.344.2in manufacturing, %Energy intensity of manufacturing, GWh/€1.641.611.501.451.381.291.151.291.09Share of energy-intensive industries in manufacturing production12.57.3GHG emissions intensity of production in sector [...], kg/€- paper and paper products (NACE C-17)1.611.631.471.241.092.422.11-0.730.68- chemicals and chemical products (NACE C20)0.380.360.320.310.280.330.35-1.251.26- other non-metallic mineral products (NACE C23)2.942.902.902.952.652.662.44-2.532.24- basic metals (NACE C24)1.311.391.111.101.151.341.06-2.793.49Reduction of effort sharing emissions20182019202020212022202320182023GHG emission reductions relative to base year, % -12.1-9.1-15.0- domestic road transport32.627.84.018.331.720.01.45.2- buildings-49.7-50.2-50.1-53.7-53.4-58.521.432.92005202120222023TargetWEMWAMEffort sharing: GHG emissions, Mt; target, gap, %11.810.410.810.1-27.0-17.51.6Sustainable industryTrendCircular economy transition20182019202020212022202320182021Material footprint, tonnes per person17.916.516.720.721.522.814.715.0Circular material use rate, %10.1      10.2      9.9        8.9        8.3        8.8        11.611.1Resource productivity, €/kg1.5        1.7        1.7        1.8        1.8        1.8        2.12.3Zero pollution industryYears of life lost due to PM2.5, per 100,000 inhabitants795      599      548      557      897      -702571Air pollution damage cost intensity, per thousand € of GVA    26.4          27.5      Water pollution intensity, kg weighted by human factors per bn € GVA    0.2   0.9SloveniaEU-27SloveniaEU-27SloveniaEU-27 
 
 
  
 
ANNEX 8: AFFORDABLE ENERGY TRANSITION 

This  annex  outlines  the  progress  made  and 
the  ongoing  challenges  faced  in  enhancing 
energy  competitiveness  and  affordability, 
while advancing the transition to net zero.  It 
examines  the  measures  and  targets  proposed  in 
the  final  (draft)  updates  to  the  national  energy 
and climate plans (NECPs) for 2030. 

In  2024,  Slovenia's  energy  system  faced 
significant  challenges  due  to  its  reliance  on 
fossil fuels which still accounted for nearly a 
quarter  of 
its  electricity  mix.  Wholesale 
electricity  prices,  among  the  highest  in  the  EU, 
were  driven  up  by  volatile  fossil  fuel  costs,  as 
infra-marginal  thermal  power  plants  ramped  up 
production,  both  in  Slovenia  and  neighbouring 
coupled markets, to cover the supply-demand gap 
created  by  increased  electricity  consumption  and 
reduced  hydropower  output.  Despite  a  13% 
increase  in  renewable  energy  capacity,  solar  PV 
deployment  slowed,  and  wind  energy  remained 
stagnant.  Grid  capacity  limitations  and  a  complex 
permitting process hindered the integration of new 
renewables.  Meanwhile,  energy  consumption  in 
industry dropped, but efforts to boost efficiency in 
other  sectors,  like  services  and  buildings,  remain 
insufficient to meet long-term goals. 

Energy prices and costs 

Except for household electricity prices which 
stagnated,  Slovenia’s  retail  energy  prices 
dropped significantly in 2024 - especially for 
non-household  consumers  -  with  final  prices 
generally  below  the  EU  average,  driven  by 
lower  network  costs  and  lighter  taxation 
compared  to  the  EU.  For  households,  lower 
electricity  bills  in  Slovenia  (which  were  28% 
cheaper than the EU average) compared to the EU 
average  were  driven  by  lower  energy/supply  and 
network  costs  (both  23%  below  the  EU  average) 
and  lighter  overall  fiscality.  While  Slovenia's  VAT 
rate  was  slightly  higher  compared  to  the  EU 
average 
levies 
(18%  vs  14.6%),  taxes  and 
excluding  VAT(150)  were  at  0.002  EUR/KWh  in 
Slovenia while they averaged 0.03 EUR/KWh in the 

(150) Taxes and levies excluding VAT comprise renewable, 

capacity, environmental, nuclear (when applicable) and other 
taxes which are usually fixed rates per unit consumed and 
not applied as percentage of final price as VAT is. 

EU,  making  overall  taxes  and  levies  paid  by 
in 
household  electricity  consumers  per  KWh 
Slovenia 45% lower than the EU average. For gas, 
prices paid by households were also lower due to 
significantly 
(at  0.013 
lower  network  costs 
EUR/kWh,  38%  below  the  EU  average)  and  lower 
overall 
costs 
taxation,  while  energy/supply 
remained  in  line  with  the  EU  average.  For  non-
household  consumers,  final  prices  for  electricity 
higher 
matched 
energy/supply  costs  (21%  higher  than  the  EU 
average  -  mainly  due 
to  higher  wholesale 
electricity  prices  in  Slovenia)  being  offset  by 
considerably  lower  network  charges  (at  0.018 
EUR/KWh,  42%  below  the  EU  average)  and  taxes. 
Non-household  gas  prices  were  below  the  EU 
average, driven by lower network costs and lighter 
fiscality  while  energy/supply  costs  remained  on 
par with the EU average. 

average,  with 

the 

EU 

Graph A8.1: Retail energy price components for 
household and non-household consumers, 2024 

(i) For household consumers, consumption band is DC for 
electricity and D2 for gas. Taxes and levies are shown 
including VAT. 
(ii) For non-household consumers, consumption band is ID for 
electricity and I4 for gas. Taxes and levies are shown 
excluding VAT and recoverable charges, as these are typically 
recovered by businesses. 
Source: Eurostat 

electricity 

the  EU’s 

in  2024(151).  Prices 

tenth  highest 
Slovenia  had 
prices,  averaging 
wholesale 
91 EUR/MWh 
in  2024 
initially fell  across the EU with decreasing natural 
gas  costs  but  surged  in  the  spring/summer  and 
winter,  with  Slovenia  and  the  broader  central-
eastern  European  region  diverging  from  central-
western European markets. This decorrelation was 
driven by  factors  affecting  both  consumption  and 
generation.  Prolonged  summer  heatwaves  and  a 

(151) Fraunhofer (ENTSO-E data). 

65 

 
 
 
 
 
 
 
cold  winter  led  to  higher  consumption  in  the 
(over  the 
region,  while  reduced  hydropower 
summer  and  winter)  due 
to  meteorological 
conditions  limited  non-fossil  flexibility.  Moreover, 
higher  export  needs  from  Croatia  (+68% 
in 
2024)(152) further exacerbated the supply-demand 
gap. This gap was mainly covered by costly natural 
gas and coal-fired generation (+20% and +10% in 
2024)  ramping up especially  during peak demand 
hours, and higher imports from Austria. This led to 
more pronounced price spikes in the evening hours 
(18h-21h)  of  2024,  as  solar  output  declined,  and 
In  contrast, 
summer  demand  remained  high. 
average  daytime  hourly  prices  dropped  in  2024, 
likely due to the significant surge in solar output in 
Slovenia (+51%) and neighbouring markets(153). 

Graph A8.2: Monthly average day-ahead wholesale 
electricity prices and European benchmark 
natural gas prices (Dutch TTF) 

Flexibility and electricity grids 

Slovenia’s capacity made available for cross-
zonal  electricity  trade  remains  consistently 
high(154),  with  the  result  that  no  action  plan 
nor  a  timeline  derogation(155)  to  achieve  the 
70%(156)  threshold  has been  necessary.  Since 
2020,  EU  Member  States  have  been  required  to 
ensure 
least  70%  of  electricity 
interconnection  capacity  is  made  available  for 
cross-border  trade.  Slovenia  is  part  of  the  Core 
and 
Italy  North  capacity  calculation  regions 
(CCRs)(157)  and  while  the  Italy  North  CCR  largely 
meets  this  target,  greater  efforts  are  needed  in 
the Core CCR. 

that  at 

Slovenia  has  strong  interconnection  links 
with  neighbouring  EU  countries,  which  have 
been  reinforced  with  the  implementation  of 
recent  projects  of  common  interest  with 
Croatia  and  Hungary.  Slovenia’s  electricity 
interconnection target is well above the minimum 
level, reaching 92% for 2025. 

of 

renewable 

grid  were 

limitations  have  slowed 

In  2023,  6 828  applications 

the 
Flexibility 
energy 
implementation 
projects. 
for 
connections  of  individual  self-consumers  to  the 
distribution 
of 
approximately  50 000),  while  1 506  approvals 
were issued with restrictions. Technical limitations 
and  voltage  issues  prevented  the  connection  of 
individual  self-sufficiency  plants,  highlighting  the 
reinforcements(158). 
need  for  distribution-level 
Since  2023,  Slovenia,  together  with  Croatia  and 
Austria,  has  been  implementing  the  GreenSwitch 

rejected 

(out 

A transitional period was granted under Article 15 of 

Transmission system operators are required under EU 

According to 2023 estimates from ACER (2024 Market 

(154) 
Monitoring Report). 
(155) 
the Electricity Regulation, allowing Member States with structural 
congestion issues to gradually reach compliance by 
31 December 2025 through action plans approved by the 
European Commission. 
(156) 
law to make 70% of transmission capacity available for 
electricity trading with neighbours by the end of 2025. 
(157) 
A CCR is a group of countries which calculate cross-
border electricity trade flows together. Core is the CCR which 
covers central European countries, namely Austria, Belgium, 
Czechia, Germany, France, Croatia, Hungary, the Netherlands, 
Poland, Romania, Slovenia, Slovakia and, once connected, Ireland. 
France, Italy, Austria and Slovenia belong to the Italy North CCR. 
(158) 
ELES (2024). The Sustainable Annual Report of ELES 
for the year 2023. 

(i) the Title Transfer Facility (TTF) is a virtual trading point for 
natural gas in the Netherlands. It serves as the primary 
benchmark for European natural gas prices. 
(ii) CEE and CWE respectively provide average prices in the 
central-western European (Belgium, France, Germany, 
Luxembourg, the Netherlands and Austria) and central-
eastern European (Poland, Czechia, Slovakia, Hungary, 
Slovenia and Romania) markets. 
Source: S&P Platts and ENTSO-E 

(152) Fraunhofer (ENTSO-E data). 
(153) 
consumption data throughout the paragraph). 

Yearly electricity data, Ember (generation and 

66 

 
 
 
 
 
project,  supported  through  the  Connecting  Europe 
Facility,  which  seeks  to  modernise  and  digitise 
these countries’ electricity grids, and increase their 
hosting capacity. 

There  have  also  been  new  projects  in  the 
solar sector, which in recent years have seen 
a  significant  uptake.  For  utility-scale  solar 
photovoltaics,  the  grid  connection  waiting  time  is 
1-4  years.  In  contrast,  the  situation  looks  slightly 
better  for  small-scale  photovoltaics,  with  a 
connection  time  of  3-12  months(159).  Further 
reflecting  the  need  for  improved  flexibility,  there 
were 96 occurrences of day-ahead negative prices 
in 2023. 

enabling 

flexibility 

Slovenia has already taken steps to promote 
the  installation  of  electricity  storage  and 
demand-response  systems,  as  well  to  put  in 
place  the  regulatory  framework  to  enable 
development  of  flexible  energy  resources. 
Slovenia  has  introduced  economic  incentives  for 
local  storage  integrated  with  renewable  energy 
sources (RES) and a support scheme for advanced 
services,  with 
devices 
implementation  expected  by  2025.  Further 
measures,  such  as  the  roll-out  of  advanced 
metering systems by 2025 and the introduction of 
economic  incentives  for  combined  RES-storage 
projects,  should  follow  until  2030,  as  outlined  in 
the  country’s  updated  NECP.  Furthermore,  there 
are  no  barriers  for  the  development  of  flexible 
resources in Slovenia’s regulatory framework, as it 
allows  for  demand-side  response 
(DSR)  and 
storage to sell and buy electricity in the day-ahead 
intraday  markets.  DSR  and  storage  are 
and 
allowed 
in  ancillary  services. 
Aggregators,  including  independent  aggregators, 
can participate in these services. 

to  participate 

Slovenia  has  taken  major  steps  towards 
empowering consumers, but some regulatory 
and  administrative  challenges  persist  in  the 
area of energy communities.  Roll-out of smart 
meters has progressed well in Slovenia, with 95% 
of  households  being  equipped  with 
them. 
Furthermore,  4.8%  of  households  generate 
electricity.  While  dynamic  contracts  are  available, 
there  is  no  comparison  tool  for  them  and  all 
household consumers are on regulated fixed-price 
contracts. Slovenia has fully opened its day-ahead 
and  intraday  markets  and  has  balanced  services 

(159) EU Market Outlook for Solar Power 2023-2027. 

67 

and  congestion  management  services  for  all 
stakeholders and distributed energy resources. The 
number  of  energy  communities  is  very  limited. 
This can be attributed to challenges related to the 
national 
administrative 
procedures and a lack of clarity regarding market 
rules.  However,  the  updated  NECP  introduces 
measures to promote energy communities and an 
enabling programme to remove obstacles. 

framework, 

legal 

In October 2024, a new system of electricity 
network  charges  for  both  businesses  and 
households entered into operation. It is based 
on  2022’s  Act  on  the  Methodology  for  the 
Charging  of  Network  Charges  for  Electricity 
Operators,  which  has  been  amended  on  several 
occasions  since  then.  The  reform  introduced  high 
(November-February)  and 
low  (March-October) 
seasons,  as  well  as  five  time  blocks  which  are 
determined  according  to the  load  on  the  network. 
Additional notable changes were made in areas of 
capacity  and  the  calculation  of  the  network 
charges. In February 2025, the Parliament passed 
an urgent bill to reduce the of network fee during 
the  most  expensive,  block  1  for  household 
consumers in January and February 2025, with the 
shortfall in the collected network fee to be covered 
by ELES, the electricity system operator. 

In  2023,  electricity  accounted  for  23.5%  of 
Slovenia’s final energy consumption,  slightly 
above  the  EU  average  of  22.9%,  and  this 
share  has  seen  a  slight  increase  in  the  last 
decade(160).  When 
it  comes  to  households, 
electricity  accounts  for  33.7%  of  final  energy 
consumption, while in industry it represents 37.6% 
(see  also  Annex  7).  For  the  transport  sector,  this 
share remains negligible at 1.3%. Further progress 
in electrification across sectors is required for cost 
the  economy  and 
effectively  decarbonising 
bringing  the  benefits  of  affordable  renewable 
generation to consumers. 

Renewables and long-term contracts 

In  2024,  42%  of  Slovenia’s  electricity  mix 
was  supplied  by  renewable  energy  sources 

CAGR (compound annual growth rate) of 0.5% 

(160) 
between 2013 and 2023 and minimum/maximum share of 
22.3% and 25.0%, respectively. 

 
 
 
(hydro, wind, solar, biomass), compared to 47% in 
the EU overall(161). 

power 

Slovenia’s 

installations. 

Slovenia  has  recorded  no  increase  in  wind 
power  capacity in  the  past  decade  and  has 
maintained  modest  goals  for  increasing  its 
share  of  renewable  energy  by  2030.  Newly 
installed renewable capacity slowed down in 2024, 
with  a  weaker  uptake  of  solar  photovoltaics 
compared to 2023 and still no deployment of new 
wind 
total 
renewable energy capacity in 2024 was 2 562 MW 
increase  of  12.7%  considerably 
(year-on-year 
below  the  22%  in  2023)(162).  This  was  driven  by 
278  MW  of  newly  installed  solar  photovoltaic 
capacity,  resulting  in  total  installed  capacity  of 
1 309 MW  in  2024.  On  the  other  hand,  the  wind 
capacity  currently  deployed  in  Slovenia  remains 
insignificant  (3 MW),  with  limited  plans  for  its 
deployment by 2030. In addition, Slovenia’s 2030 
renewable  energy  target  of  at  least  33%  falls 
short of the EU Commission’s recommended 46%. 
In 2023, the share of renewable energy sources in 
Slovenia’s  gross 
consumption 
stagnated at 25% (EU average at 24.5%)(163). 

final  energy 

Graph A8.3: Slovenia's installed renewable 
capacity (left) and electricity generation mix 
(right) 

"Other" includes solid biofuels, liquid biofuels and biogas 
Source: IRENA, Ember 

There is a need to ensure a just transition in 
Slovenia’s  coal  regions.  In  response  to  the 
significant  financial  losses  and  the  impending 
bankruptcy  of  the  Šoštanj  coal-fired  thermal 
power  plant  (TEŠ)  and  the  Velenje  coal  mine,  the 
the  Act  on  Transitional 
Parliament  passed 
Financing for an Accelerated and Fair Coal Phase-
out  in  December  2024.  In  line  with  that  Act,  the 

(161) Yearly electricity data, Ember. 
(162) Renewable capacity statistics 2025, IRENA. 

(163) Eurostat. 

68 

Government  will  provide  an  estimated  EUR 403.1 
million  to  ensure  the  operation  of  TEŠ  and  the 
Velenje  coal  mine  from  January  2025  to  April 
2027. During this period, TEŠ will primarily provide 
heat for district heating as a public service for the 
Šaleška  valley  (the  municipalities  of  Velenje  and 
Šoštanj). In efforts to ensure alternative source of 
heat,  in  the  years  to  come,  the  Act  foresees  that 
the  municipal  energy  company  to  initiate  public 
procurement  until  1st  of  June  2025  and  to  sign  a 
contract by 1st of January 2026. The ownership of 
TEŠ  and 
the  Velenje  coal  mine  was  also 
transferred from the Holding Slovenske elektrarne 
and is now managed by the Slovene State Holding. 
Slovenia  still  aims  to  complete  the  phase  out  of 
coal by 2033. 

Despite  Slovenia  undertaking  a  number  of 
reforms  on  permitting  from  2023  to  2024, 
deployment of wind capacities has stalled in 
the  country.  Slovenia’s  legal  framework  for 
permitting  is  moderately  to  strongly  aligned  with 
the Commission’s  Recommendation.  Following the 
2023  Act  on  the  Deployment  of  Installations  for 
the  Production  of  Electricity  from  Renewable 
Energy  Sources,  the  Slovenian  Parliament  passed 
in  April  2024.  This  Act 
the  Energy  Act 
comprehensively  adapts 
legal 
the  country’s 
framework  in  the  energy  sector  to  support  the 
green  transition  and  speed  up  permitting.  In  April 
2024, the Regulation on Detailed Spatial Planning 
the  Placement  of  Photovoltaic 
for 
Rules 
Installations 
Energy  Collectors, 
Solar 
envisaged  under  the  recovery  and  resilience  plan, 
entered  into  force,  after  being  adopted  by  the 
government. 

and 

to 

relates 

progress 

Further 
the 
establishment  and  gradual  introduction  of 
the  eBuilding  (eGraditev)  system,  which  will 
be  fully  operational  by  2026.  It  will  fully 
digitalise  the  process  of  obtaining  a  building 
permit,  as  well  as  of  communication  with 
competent  authorities  (with  few  exceptions).  On 
the  other  hand,  despite  the  legal  improvements 
made, the installation of wind power plants is still 
being  delayed  by  local  opposition  and  lengthy 
municipal permitting procedures. Capacity building 
through  providing  training  and  boosting  the 
resources  available  to  local  authorities  could,  for 
instance,  contribute  to  faster  permit-processing 
and  reduce  potential  bottlenecks  in  the  system.  A 
significant  limitation  in  Slovenia  is  that  permits 
cannot  be  applied  for  simultaneously,  as  each 

 
 
 
permit  or  approval  typically  requires  the  previous 
one to be obtained first. 

So  far,  Slovenia  has  not  set  up  auctions  to 
support  the  uptake  of  renewable  energy. 
Slovenia  lacks transparency  in  its  project  pipeline, 
as  it  has  not  published  a  long-term  auction 
schedule  for  the  next  3-5  years,  including  details 
on timing, frequency and expected capacity. 

Power  purchase  agreements 
(PPAs)  are 
relatively  new  in  much  of  south-eastern 
Europe,  with  Slovenia  entering  the  market 
for the first time in 2023. While interest in the 
market  is  growing  and  there  is  potential  to  scale 
up,  barriers  to  PPAs  need  to  be  tackled.  Still,  the 
PPA  projects  are  expected  to  receive  financial 
incentives  as  envisaged  under  the  final  updated 
NECP.  The  renewal  or  modification  of  the  RES 
support  scheme  is  scheduled  for  2025,  as  it  is 
linked  to  changes  in  the  legal  bases  (introduction 
of 
contract-for-differences  mechanism, 
combination with the PPA mechanism and others). 
The  support  scheme  is  set  to  be  upgraded  every 
three  years  (next  in  2028)  to  contribute  at  least 
1% annually or 500 GWh. 

the 

Energy efficiency 

Energy  efficiency  gains  have  increased  in 
Slovenia,  while  still 
leaving  room  for 
improvement. In 2023, Slovenia’s primary energy 
consumption  was  5.9 Mtoe,  a  4.6%  decrease 
compared  to  2022.  Its  final  energy  consumption 
was 4.5 Mtoe, a 5.2% decrease compared to 2022. 
The  best  results  came  from  the  industrial  sector, 
which  decreased  its  final  energy  consumption  by 
9.1%,  and  the  worst  from  the  services  sector, 
which  increased  its  final  energy  consumption  by 
0.1%. The biggest single efficiency improvement in 
2023  came  from  the  installation  of  a  combined 
heat  and  power  unit  in  the  power  sector,  which 
accounted  for  81%  (1 863.9  GWh)  of  the  total 
savings in 2023. In the private sector, the highest 
through  waste  heat 
savings  were  achieved 
recovery  systems  in  buildings  and  the  installation 
of  advanced  metering  systems.  This  means 
Slovenia is well on track towards meeting its 2030 
national  contribution  according  to  the  recast 
Energy  Efficiency  Directive 
(EU) 
2023/1791)  of  4.319 Mtoe  for  FEC  and  5.8 Mtoe 
for  PEC.  At  the  same  time,  Slovenia  has  not 

(Directive 

submitted  its  comprehensive  heating  and  cooling 
assessment  as  required  by  Article 25(1)  of  the 
Energy Efficiency Directive. 

Slovenia  needs  to  continue  working  towards 
reaching  its  long-term  renovation  strategy 
target  to  reduce  the  energy  consumption  of 
buildings by 17% by 2030 compared to 2020. 
The  residential  sector’s  climate-corrected  final 
energy consumption declined only by 3% between 
2020  and  2022.  In  2022,  heating  and  cooling 
represented  79%  of  Slovenia’s  residential  final 
energy consumption. 

to 

the 

proportion 

considerable 

Slovenia’s 
of 
renewables  in  heating  and  cooling  (36%  in 
2024)  is  mainly  the  result  of  biomass  use. 
Heat  pumps  cover  about  a  tenth  of  this. 
According 
revised  Renewable  Energy 
Directive, Member States must aim to increase the 
share  of  RES  in  heating  and  cooling  by  0.8%  per 
year  on  average  in  2021-2025  and  by  1.1%  in 
2026-2030.  The  evolution  of  the  ratio  in  the 
Slovenian  NECP  shows  that  this  increase  is  not 
being  achieved,  as  it  is  projected  to  increase  by 
0.5%  annually  on  average  in  the  first  period  and 
1.0% in the second period. The lower RES share is 
affected by the fact that a large part of the RES in 
heating and cooling is woody  biomass, the use of 
which 
is  decreasing  as  a  result  of  energy 
efficiency measures.  The objective in  the  updated 
NECP  is  to  reach  a  proportion  of  at  least  45%  of 
RES  in  heating  and  cooling  by  2030.  Slovenia  is 
developing  a  heating  and  cooling  strategy  for 
2050,  to  be  completed  by  2025.  To  support  this 
goal,  the  country  has  banned  gas  boilers  in  new 
buildings  and  introduced  a  financing  programme 
to  cover  20%  of  heat  pump  installation  costs,  up 
to  EUR 4 000.  Additionally,  with  a  32%  drop  over 
the  past  five  years,  the  decreasing  electricity-to-
gas  price  ratio  has  made  heat  pumps  more 
financially viable. 

investments  and 

Slovenia deploys a supportive, albeit limited, 
national  financing  framework  that  mobilises 
energy  efficiency 
is 
composed mainly of grants and soft loans. In 
2024,  Slovenia  continued  to  implement  its  eco-
fund  and  energy-savings  obligation  schemes.  In 
terms  of  sectors  supported,  Slovenia  tends  to 
adopt a multi-sector approach, with some focus on 
public  and  residential  buildings,  including  through 
the  implementation  of  different  EU-supported 
programmes,  such  as  the  recovery  and  resilience 
plan. 

69 

 
Security of supply and diversification 

Despite  progress  in  renewables,  Slovenia’s 
overall  energy  mix  in  2023  remained  quite 
reliant on fossil fuels. Oil accounted for 35.5%, 
coal 11.7% and natural gas 10.6% of gross inland 
consumption(164),  while  nuclear  heat  contributed 
21.2%  and  renewables  (and  biofuels)  20.1%  (vs 
16.8% in 2022)(165). 

before  2030  represented  0.18%(167)  of 
Slovenia’s  GDP(168),  below  the  EU  weighted 
average  of  0.49%.  Tax  measures  and 
income/price support accounted for 52% and 48% 
of  this  volume,  respectively.  However,  Slovenia’s 
2023  Effective  Carbon  Rate(169)  averaged  EUR 
81.74  per  tonne  of  CO₂,  slightly  below  the  EU 
weighted mean of EUR 84.80(170). 

and 

The  development  of  Slovenia’s  electricity 
generation  sector  will  remain  (until  2030) 
largely reliant on a mix of renewable energy 
sources 
power,  while 
nuclear 
progressively  reducing  reliance  on  coal.  The 
Krško  nuclear  power  plant  will  aim  to  keep  the 
number of unplanned automatic shutdowns below 
or  equal  to  one  over  a  three-year  period,  with  a 
view to being able to produce at least 5 200 GWh 
of  electricity  per  year.  At  the  strategic  level, 
Slovenia  supports  the  continued  use  of  nuclear 
energy  for  electricity  production,  including  the 
potential  construction  of  a  new  nuclear  power 
plant  and  small  modular  reactors  (SMRs),  under 
the  Resolution  on  the  Long-Term  Peaceful Use  of 
Nuclear  Energy,  Nuclear  Energy  for  the  Future  of 
Slovenia,  adopted  in  May  2024.  The  Slovenian 
Parliament  cancelled  the  consultative  referendum 
on  the  construction  of  the  new  Krško  2  nuclear 
power plant, originally scheduled for November 24. 
According 
the 
referendum  will  take  place  at  a  later  stage  once 
the  project’s  national  spatial  plan  and  other  key 
studies  and  assessments  are  completed  – 
ensuring  people  can  make  an  informed  decision. 
This  is  tentatively  expected  to  happen  as  part  of 
the next government mandate. 

the  Slovenian  authorities, 

to 

Fossil fuel subsidies 

In  2023,  environmentally  harmful  (166)  fossil 
fuel  subsidies  without  a  planned  phase-out 

Electricity and heat are excluded to avoid double-

(164) 
counting, focusing on primary energy sources. 
(165) Gross inland consumption (Eurostat). 
(166) Direct fossil fuel subsidies that incentivise maintaining or 
increasing in the availability of fossil fuels and/or use of 
fossil fuels. 

(167) Numerator is based on volumes disclosed by the Slovenian 
authorities via the 2025 NECPR reporting. For all Member 
States, it includes public R&D expenditures for fossil fuels as 
reported by the IEA (Energy Technology RD&D Budgets) and 
excludes, for methodological consistency, excise tax 
exemption on kerosene consumed in intra-EU27 air traffic. 

(168) 2023 Gross Domestic Product at market prices, Eurostat. 

(169) The Effective Carbon Rate is the sum of carbon taxes, ETS 
permit prices and fuel excise taxes, representing the 
aggregate effective carbon rate paid on emissions. 

(170) OECD (2024), Pricing Greenhouse Gas Emissions 2024 

70 

 
 
 
 
Table A8.1:  Key Energy Indicators 

Source: Eurostat, ENTSO-E, S&P Platts 

71 

20212022202320242021202220232024Household consumer - Electricity retail price (EUR/KWh)0.1686          0.1677              0.2018              0.2062          0.2314              0.2649          0.2877          0.2879          Energy & supply [%]39.3%50.5%52.0%51.6%36.6%54.3%55.6%47.8%Network costs30.0%25.2%27.9%29.2%26.7%25.3%24.8%27.2%Taxes and levies including VAT30.7%24.3%20.0%19.2%36.7%20.3%19.6%25.0%VAT18.0%16.3%14.3%18.0%14.5%13.4%13.8%14.6%Household consumer - Gas retail price0.0563          0.0794              0.1025              0.0944          0.0684              0.0948          0.1121          0.1128          Energy & supply47.4%62.1%70.2%62.3%43.7%61.0%64.5%53.9%Network costs22.7%15.9%12.8%13.6%22.5%17.3%17.1%18.3%Taxes and levies including VAT29.8%22.0%17.0%24.2%33.8%21.7%18.4%27.8%VAT18.1%15.6%12.2%18.0%15.5%11.6%10.2%13.6%Non-household consumer - Electricity retail price0.0851          0.1694              0.2159              0.1616          0.1242              0.1895          0.1971          0.1661          Energy & supply57.1%74.0%75.5%67.5%43.0%66.5%63.0%55.8%Network costs13.4%5.8%6.1%9.0%15.8%10.7%11.9%15.5%Taxes and levies excluding VAT14.0%6.1%5.0%6.7%30.4%9.9%11.2%15.4%Non-household consumer - Gas retail price0.0342          0.0625              0.0584              0.0481          0.0328              0.0722          0.0672          0.0517          Energy & supply66.4%77.1%77.0%71.0%66.2%77.3%77.3%68.7%Network costs7.4%3.9%5.9%6.5%7.7%3.8%5.3%7.1%Taxes and levies excluding VAT9.9%3.7%3.8%5.4%12.5%6.1%7.3%11.6%Wholesale electrity price (EUR/MWh)114.6273.7104.691.2111.0233.299.184.7Dutch TTF (EUR/MWh)n/an/an/an/a46.9123.140.534.420172018201920202021202220232024Gross Electricity Production (GWh)16,326          16,327              16,100              17,191          15,877              13,617          15,879          -Combustible Fuels5,610         5,397             5,287             5,239         4,715            3,958         3,961         -Nuclear6,285         5,776             5,821             6,353         5,706            5,606         5,603         -Hydro4,141         4,893             4,683             5,225         4,997            3,401         5,322         -Wind6                 6                     6                     6                 6                    6                 6                 -Solar284             255                303                368             453                646             984             -Geothermal-              -                 -                 -              -                 -              -              -Other Sources-              -                 -                 -              -                 1                 2                 Gross Electricity Production [%]Combustible Fuels34.4%33.1%32.8%30.5%29.7%29.1%24.9%-Nuclear38.5%35.4%36.2%37.0%35.9%41.2%35.3%-Hydro25.4%30.0%29.1%30.4%31.5%25.0%33.5%-Wind0.0%0.0%0.0%0.0%0.0%0.0%0.0%-Solar1.7%1.6%1.9%2.1%2.9%4.7%6.2%-Geothermal0.0%0.0%0.0%0.0%0.0%0.0%0.0%-Other Sources0.0%0.0%0.0%0.0%0.0%0.0%0.0%-Net Imports of Electricity (GWh)-516-502-319-2,003-2701,446-1,506-As a % of electricity available for final consumption -3.8%-3.6%-2.3%-15.4%-2.0%11.0%-12.1%-Electricity Interconnection [%]83.6%73.6%76.2%78.9%65.8%75.6%82.1%85.5%Share of renewable energy consumption - by sector [%]Electricity32.4%32.3%32.6%35.1%35.0%37.0%41.9%-Heating and cooling34.6%32.3%32.1%32.1%35.2%34.0%34.3%-Transport2.6%5.5%8.0%10.9%10.6%7.8%10.0%-Overall21.7%21.4%22.0%25.0%25.0%25.0%25.1%-20202021202220232020202120222023Import Dependency [%] 45.7%48.6%53.9%49.3%57.5%55.5%62.5%58.3%of Solid fossil fuels 17.7%11.0%28.1%27.0%35.8%37.2%45.9%40.8%of Oil and petroleum products 99.5%99.6%98.4%98.9%96.8%91.7%97.8%94.5%of Natural Gas 99.4%99.4%99.5%99.4%83.6%83.6%97.6%90.0%Dependency from Russian Fossil Fuels [%]of Natural Gas 8.7%13.6%8.6%0.0%41.0%40.9%20.7%9.3%of Crude Oil0.0%0.0%0.0%0.0%25.7%25.2%18.4%3.0%of Hard Coal21.9%0.2%0.0%0.0%49.1%47.4%21.5%1.0%2017201820192020202120222023Gas Consumption (in bcm)0.9                 0.9                     0.9                     0.9                 1.0                    0.8                 0.8                 Gas Consumption year-on-year change [%]4.8%-1.9%1.5%0.0%5.4%-11.1%-2.3%Gas Imports - by type (in bcm)0.9                 0.9                     0.9                     0.9                 0.9                    0.8                 0.8                 Gas imports - pipeline0.9                 0.9                     0.9                     0.9                 0.9                    0.8                 0.8                 Gas imports - LNG0.00.00.00.00.00.00.0Gas Imports - by main source supplier [%]Austria75.0%67.5%88.0%91.0%85.1%82.1%68.3%Algeria0.0%0.0%0.0%0.0%1.1%3.8%28.3%Italy0.0%0.0%0.2%0.3%0.2%5.2%2.6%Russia23.0%31.3%11.8%8.7%13.6%8.6%0.0%SloveniaEU 
 
     
 
ANNEX 9: CLIMATE ADAPTATION, PREPAREDNESS AND ENVIRONMENT 

Slovenia  is  exposed  to  several  climate  risks 
and  extreme  weather  events,  such  as  heat 
waves,  forest  fire,  floods  and  drought,  and 
should take urgent action to build up climate 
and  water  resilience,  and  support  climate 
adaptation  measures. 
Improving  sustainable 
water  management  can  reduce  the  devastating 
impacts  of  floods 
in  the  event  of  extreme 
precipitation.  The  degradation  of  nature  and 
ecosystems  also  reduces  climate  resilience  in 
Slovenia.  Key  economic 
such  as 
agriculture, the food industry, tourism, construction 
and  pharmaceuticals  are  highly  dependent  on 
ecosystem services and reducing climate risks and 
therefore 
environment 
protecting 
fundamental 
and 
economic 
competitiveness. 

are 
stability 

sectors 

the 

to 

Climate adaptation and preparedness 

Slovenia 
is  vulnerable  to  heavy  floods, 
heatwaves and droughts. Major weather events 
have occurred over recent years, such as wildfires 
in  2022  and  windstorms  with  heavy  floods  in 
2023.  In  2022,  Slovenia  suffered  a  drought 
following  a  significant  shortage  of  rainfall  and  a 
long-lasting heatwave, affecting large parts of its 
territory (55.5%). This resulted in one of Slovenia's 
largest  wildfires,  burning  around  4 000 ha, 
compared  to  an  annual  average  of  342 ha  over 
the  last  two  decades.  In  August  2023,  Slovenia 
experienced  devastating 
floods,  which  also 
triggered multiple landslides.  

Climate  risks  directly  affect  Slovenia’s 
economy and society. Between 1980 and 2023, 
it  incurred  EUR 17.5 billion  in  economic  losses, 
resulting  in  the  highest  per  capita  damage  in  the 
EU.  Meanwhile,  only  2%  of  the  economic  losses 
were  insured (171).  Floods  are  the  extreme  events 
that  cause  Slovenia  the  greatest  damage.  The 
floods  in  August  2023  caused  an  estimated 
EUR 10 billion  of  damage  (16%  of  national  GDP) 
and at least seven people were killed (172). Slovenia 
recorded  a  significant  increase  in  heat-related 
deaths  over  the  period  2013-2022,  with  around 

(171) EEA, 2024, Economic losses from weather- and climate-

related extremes in Europe, Link. 

(172) Bezak, N. et al., 2023, Brief communication: A first 

hydrological investigation of extreme August 2023 floods in 
Slovenia, Europe, Link. 

45 deaths per 100 000 people, up from 32 during 
the previous decade. 

Institutional  weaknesses 
remain  a  key 
challenge  in  Slovenia.  Slovenia  adopted  the 
National  Strategic  Framework  on  Adaptation  to 
Climate  Change  in  2016  but  began  preparing  a 
new national adaptation strategy in 2024. Several 
strategic documents address climate impacts, such 
as  the  2021  long-term  strategy,  or  the  2022  - 
2028  Strategy  of  Slovenian  Tourism.  Slovenia’s 
national  energy  and  climate  plan  acknowledges 
that further action is required as there is currently 
a  low  level  of  implementation  of  adaptation 
measures.  Key  objectives  are  to  reduce  exposure 
to climate change impacts by setting up a climate 
change  adaptation  centre  and  the  establishment 
of a new adaptation strategy.   To  date,  only  the 
agriculture,  forestry  and  electricity  sectors  have 
embraced adaptation strategies, making slow and 
uneven progress. In the autumn of 2024, Slovenia 
organised  a  training  for  priority  sectors  and 
instructions  for  the  preparation  of 
prepared 
sectoral 
risk 
climate 
assessments.  The  final  preparations  are  currently 
underway  to  start  the  risk  assessments  for  ten 
priority  areas,  which  should  be  completed  at  the 
end of 2025. 

vulnerability 

and 

including 

its  preparedness, 

Slovenia  makes  use  of  various  EU  funds  to 
improve 
the 
Recovery  and  Resilience  Facility  and  2021-27 
cohesion  policy  support,  as  well  as  the  EU 
Solidarity  Fund.  Its  recovery  and  resilience  plan 
features adaptation measures, such as reforms to 
enhance  preparedness  and  response  to  climate-
driven  disasters,  while  both  the  Recovery  and 
Resilience Facility and cohesion policy programme 
cover 
flood 
in 
protection  and  water  management.  Nature-based 
solutions  are  key  to  mitigating  the  impact  of 
floods,  while  protecting  nature.  To  effectively 
address  flood  protection,  it  is  crucial  that  nature-
into  sectoral 
based  solutions  are 
policies  from  the  spatial  planning  stage  onwards. 
This 
reporting  and 
evaluation  system,  and  improved  coordination 
between government sectors. 

requires  a  monitoring, 

nature-based 

investments 

integrated 

Slovenia  aims  to  strengthen  its  climate 
adaptation  actions,  particularly  at  local  and 
regional  level.  Besides  the  Climate  Change 
Adaptation  Centre,  Slovenia  plans  to  establish 
local points for regions and municipalities, though 
implementation  remains  key.  In  autumn  2024, 

72 

 
 
 
 
 
Slovenia established a Climate office together with 
the  Association  of  Municipalities  of  Slovenia  to 
strengthen  the  climate  resilience  of  Slovenian 
municipalities  and  regions  in  the  long  term,  help 
them manage climate risks, and integrate climate 
change  adaptation  into  municipal  and  regional 
spatial plans and projects.  

Water resilience 

tourism 

production, 

Some areas of Slovenia are subject to water 
stress,  particularly  due  to  demands  from 
electricity 
and 
manufacturing.  These  sectors  are  heavily 
dependent on water supply, and irrigation is crucial 
in  many  rural  areas.  Slovenia’s  water  productivity 
is  considerably  lower  than  that  of  many  Member 
States,  standing  at  EUR 56  per  m3  of  abstracted 
water  in  2022  and  showing  an  increasing  trend 
over  a  five-year  period.  The  water  exploitation 
index  plus  (WEI+)  was  0.6  in  2022  and  has  been 
quite  stable  over  the  last  few  years.  Total  water 
consumption  during  all  periods  of  the  year  is 
below  renewable  freshwater  resources.  The  WEI+ 
value  is  generally  very  low  and  ranged  between 
0.4  and  1.0  between  2016  and  2020.  The  main 
consumers of water are electricity, cooling and the 
public  water  supply,  but  they  all  showed  a 
decreasing trend over the period 2018-2022. 

Water  quality  in  Slovenia  is  relatively  good, 
except for its chemical status, but it can only 
be  partially  assessed.  Slovenia  has  failed  to 
submit  the  third  river  basin  management  plans 
(RBMPs) (2022-2027) under the Water Framework 
Directive  on  time  (by  March  2022),  and  the 
Commission has not been able to include Slovenia 
in its report on the assessment of the third RBMPs 
to the European Parliament and the Council. Data 
on the ecological status/potential of surface water 
bodies and on the chemical status of surface and 
groundwater  bodies  are  not  therefore  updated.  In 
the second RBMPs (2015-2021), Slovenia reported 
that 58% of surface water bodies were in good or 
better  ecological  status/potential.  Almost  all 
surface  water  bodies  were  reported  as  failing  to 
achieve  good  chemical  status,  while  86%  of 
groundwater  bodies  achieved  good  chemical 
status.  

Slovenia’s  wastewater  treatment  is  a  cause 
for  concern.  Overall,  Slovenia’s  compliance  rate 

73 

should 

protection 

for  water 

was 61% in 2020, and 32 agglomerations did not 
comply  with  all  of  the  Directive's  requirements 
Despite improvements over the years, in particular 
thanks  to  EU  funding,  Slovenia  is  still  facing 
difficulties in implementing the Urban Wastewater 
Treatment Directive. This has forced the European 
Commission  to  take  legal  action  that  has  led  to 
rulings  of  the  Court  of  Justice  of  the  European 
Union in respect of the agglomeration of Ljubljana. 
take  additional 
therefore 
Slovenia 
measures and implement projects that would close 
the  gap  in  compliance  with  the  requirements  of 
the  Directive,  making  use  of  the  available  EU 
funding,  i.e.  the  European  Regional  Development 
Fund  and  the  Recovery  and  Resilience  Facility 
(RRF).  As  shown  in  Graph  A7.2,  the  investment 
and  water 
needs 
management are substantial, with a financing gap 
of  EUR 260  million  per  year  until  2027.  Roughly 
31% of the gap can be attributed to unaddressed 
in  wastewater  management. 
financing  needs 
Increasing 
investments  will  be  all  the  more 
important  as  the  Directive  was  revised  and 
(173).  Slovenia’s  water 
strengthened 
investments  amount  to  around  EUR 441  million 
per  year.  Of  this,  7.4%  is  from  the  2021-2027 
multiannual financial framework and an additional 
5.4%  from  the  RRF.  The  bulk  of  financing  comes 
Further 
from 
infrastructure  development  would  help  improve 
water management, e.g. wastewater collection and 
treatment,  water  reuse  and  the  general  water 
supply.  Additional  investments  are  needed  to 
improve  monitoring  (quality  and  quantity)  and  to 
support  nature-based  solutions,  flood  prevention 
and river restoration. 

in  2024 

(87.3%). 

national 

sources 

Biodiversity and ecosystems 

The  state  of  nature  and  ecosystems 
continues  to  degrade  in  Slovenia,  reducing 
the  country’s  climate  resilience.  Slovenia  is  a 
biologically diverse country and is home to a large 
(174). 
number  of  species  endemic  to  Europe 
However,  according  to  the  latest  available  data, 
only 38.2% of the country’s habitats have a good 

(173) Directive 2024/3 019, of 27 November 2024. The deadline 

for transposition is 31 July 2027. 

(174) Convention on Biological Diversity, Slovenia - Country Profile, 

Link. 

 
 
status,  and  over  61%  have  a  poor  or  bad  status. 
Similarly,  the  conservation  status  of  species  is 
concerning,  with  29%  reported  as  having  a  good 
status,  higher  than  the  EU  average  of  27%,  but 
with 53% of species  having a  poor or bad status. 
Data  show  a  deteriorating  trend  compared  to  the 
previous reporting period. This situation has severe 
implications  for  Slovenia’s  climate  resilience,  as 
the loss of biodiversity impairs ecosystems’ ability 
to  provide  services  that  help  mitigate  the  effects 
of climate change, such as regulating water cycles, 
maintaining soil health and sequestering carbon. 

Graph A9.1: Direct dependency(1) on ecosystem 
services(2) of the gross value added generated by 
economic sector in 2022 

(1) Dependency based on the sector’s own operations, 
excluding value chain operations within countries and across 
international value chains. A high dependency indicates a high 
potential exposure to nature-related shocks or deteriorating 
trends, which means that the disruption of an ecosystem  
service could cause production failure and severe financial 
loss. 
(2) Ecosystem services are the contributions of ecosystems to 
the benefits that are used in economic and other human 
activity, including provisioning services (e.g. biomass 
provisioning or water supply), regulating and maintenance 
services (e.g. soil quality regulation or pollination), and cultural 
services (e.g. recreational activities). 
Source: Hirschbuehl et al., 2025, The EU economy's 
dependency on nature, Link. 

Nature  degradation  presents  significant 
economic  and  competitiveness  risks.  In  fact, 
Slovenia’s  dependency  on  ecosystem  services  is 
high,  and  very  close  to  the  EU  average  for  direct 
supply  chain  and  downstream  dependency.  In 
terms  of  overall  dependency  on  ecosystem 

74 

services, which stands at 34%, it is also very close 
to the EU average (36%). Several sectors, such as 
agriculture, forestry, fisheries, construction, mining 
and metals, healthcare delivery and water utilities 
(see  Graph  A9.1),  are  particularly  dependent  on 
ecosystem  services,  with  100%  of  these  sectors' 
gross  value  added  directly  dependent  on  them. 
This means that failure to maintain the capacity of 
ecosystems  to  deliver  services  could  result  in 
significant  costs  or  even  stop  production  in  these 
sectors.  Protecting  and  restoring  key  ecosystems 
would ensure that their long-term competitiveness 
is preserved. As regards rivers, between 2006 and 
2015,  the  extent  of  soil  areas  providing  flood 
control ecosystem services decreased by 79% due 
to  soil  sealing  (175),  the  greatest  decrease  in  the 
EU.  Moreover,  the  economic  losses  normalised  by 
GDP  in  Slovenia  are  much  higher  than  the  EU 
average (about 0.5% of GDP from 1980 to 2023) 
(176), which highlights the need for flood protection 
measures, including river ecosystem restoration. 

Targeted  action  on  nature  protection  and 
restoration  is  needed  to  meet  Slovenia’s 
nature  restoration  targets.  With  41%  of  its 
territory  covered  by  protected  land  area  in  2022, 
Slovenia  ranks  second  among  the  Member  States 
in  terms  of  its  share  of  protected  area  on  land, 
after  Bulgaria.  In  contrast,  only  5%  of  Slovenia’s 
marine area is protected. Slovenia’s protected land 
area  therefore  makes  a  contribution  to  the  EU 
biodiversity  strategy  target  that  is  above  the  EU 
average,  but  makes  a  much  lesser  contribution 
when it comes to EU protected sea areas. Slovenia 
also needs to restore up to 2 843 km2 of habitats 
I  to  the  Habitats  Directive, 
listed 
corresponding  to  up  to  14%  of  its  territory  (177). 
Slovenia needs EUR 326 million of investment per 
year to effectively conserve and restore its natural 
capital,  mitigate  the  impacts  of  climate  change, 
and  preserve  the  country’s  rich  biodiversity  (see 
Graph  A9.2).  The  current  level  of  financing  for 
biodiversity  and  ecosystem  conservation 
in 
Slovenia  is  around  EUR 124  million  per  year.  This 
shortfall puts at risk the country’s commitment to 

in  Annex 

(175) European Commission, European Environment Agency, 2021, 

Accounting for ecosystems and their services in the 
European Union. 

(176) EIOPA, 2024, Dashboard on insurance protection gap for 

natural catastrophes, Link. 

(177) European Commission (2022), Impact assessment 

accompanying the proposal for a Regulation on nature 
restoration. 

0%20%40%60%80%100%AgricultureForestryFishery and acquacultureMining and metalsConstructionWater utilitiesHealthcare deliveryAviation travel and tourismFood beverages and tobaccoSupply chain and transportPublic services and othersElectricityChemical and materials industryElectronicsOil and gasReal estateHeat utilitiesAutomotiveRetail consumer goods and…Information technologyBanking and capital marketsInsurance and asset…Digital communicationsHighMediumLow 
   
 
significant  impact  on  air,  water  and  soils.  In 
2022,  agriculture  was  responsible  for  a  total  of 
1.7  million  tonnes  of  CO2eq  (this  figure  has  been 
stable  since  2018),  accounting  for  around  10.6% 
of  the  country’s  total  emissions.  This  includes  1.7 
million  tonnes  of  CO2eq  from  livestock.  Slovenia's 
utilised  agricultural  area  (UAA)  has  remained 
stable  since  2014,  standing  at  480 000  hectares 
in  2022.  Nevertheless,  the  nitrogen  balance  did 
not  follow  the  same  trend,  with  a  decrease  from 
68.8 kg of nitrogen per hectare of UAA in 2013 to 
42 kg in 2014, and then rising to 48.5 kg in 2021. 
Furthermore,  according  to  data  from  the  Nitrates 
Directive,  9%  of  groundwater  monitoring  stations 
in 
nitrate 
concentrations  above  50 mg/l  between  2016  and 
2019, exceeding the healthy threshold for human 
consumption.  Although  the  livestock  density  index 
was 1.01 in 2020, above the EU average of 0.75, 
ammonia  emissions  were  stable  between  2012 
and 2021, followed by a more noticeable decrease 
in  2022. 
In  2022,  pesticide  concentrations 
exceeding  thresholds  were  detected  in  10%  of 
surface  water  bodies,  which  is  below  the  EU 
average. 

recorded 

Slovenia 

average 

the 

impact 

Slovenia  is  transitioning  to  a  sustainable 
food  system  by  implementing  policies  to 
of 
environmental 
reduce 
agriculture. In 2022, 5.9% of its agricultural land 
had  landscape  features  such  as  woods  and  non-
productive  grasslands,  slightly  above  the  EU 
average  of  5.6%.  Organic  farming,  which  reduced 
the  use  of  synthetic  fertilisers  and  pesticides, 
made  up  11.1%  of  Slovenia’s  agricultural  land,  a 
51%  increase  since  2012.  Under  its  common 
agricultural  policy  (CAP)  strategic  plan,  Slovenia 
aims to reach 17% UAA under organic farming by 
2027, which it will be able to achieve if the current 
is 
growth 
maintained over the coming years. 

farming  area 

in  organic 

trend 

global biodiversity agreements and undermines its 
long-term economic and social development. 

Graph A9.2: Investment needs and gaps in EUR 
million, in 2022 constant prices 

Source: European Commission, DG Environment, 
Environmental investment needs & gaps assessment 
programme, 2025 update. 

Sustainable agriculture and land use 

Slovenia’s  carbon  removals  are  in  line  with 
the  level  of  ambition  needed  to  meet  its 
2030  target  for  land  use,  land  use  change 
and forestry (LULUCF). In Slovenia, LULUCF net 
removals have decreased from 0.64 million tonnes 
CO2  equivalent  (CO2eq)  to  0.17  million  tonnes 
CO2eq  from  2019  to  2022.  The  country’s  forests 
are  responsible  for  a  major  share  of  these 
removals.  To  meet  its  2030  LULUCF  target, 
additional  carbon  removals  of  -0.2  million  tonnes 
of  CO2eq  are  needed  (178).  The  latest  available 
projections show a surplus compared to the target 
of  -2.6  million  tonnes  of  CO2eq  for  2030  (179).
Slovenia  is  therefore  on  track  to  meet  its  2030 
target. 

Slovenian  agriculture  is  a  major  source  of 
greenhouse  gas  emissions  and  has  a 

(178) National LULUCF targets of the Member States in line with 

Regulation (EU) 2023/839. 

(179) Climate Action Progress Report 2024 COM/2024/498. 

75 

 - 100 200 300 400 500 600 700 800BiodiversityWaterBaselineGap 
   
 
 
 
 
 
 
Table A9.1:  Key indicators tracking progress on climate adaptation, resilience and environment 

(1) The data show the average for the timespan 2006-2023 based on EFFIS - European Forest Fire Information System. 
(2) Scale: 0 (no protection gap) – 4 (very high gap). EIOPA, 2024, Dashboard on insurance protection gap for natural catastrophes. 
(3) van Daalen, K. R. et al., 2024, The 2024 Europe report of the Lancet Countdown on health and climate change: unprecedented 
warming demands unprecedented action. The Lancet Public Health. 
(4) This indicator measures total water consumption as a percentage of the renewable freshwater resources available for a given 
territory and period. Values above 20% are generally considered to be a sign of water scarcity, while values equal or greater than 
40% indicate situations of severe water scarcity. 
(5) European Commission, 2024, seventh Implementation Report from the Commission to the Council and the European 
Parliament on the implementation of the Water Framework Directive (2000/60/EC) and the Floods Directive (2007/60/EC) (Third 
River Basin Management Plans and Second Flood Risk Management Plans). 
(6) For this indicator, the EU average includes figures for the UK under the previous configuration, EU-28. 
(7) European Commission, 2023, EU Bioeconomy Monitoring System dashboards. 
(8) Nitrates can persist in groundwater for a long time and accumulate at a high level through inputs from anthropogenic sources 
(mainly agriculture). The EU drinking water standard sets a limit of 50 mg NO3/L to avoid threats to human health. 
(9) Net removals are expressed in negative figures, net emissions in positive figures. Reported data are from the 2024 
greenhouse gas inventory submission. 2030 value of net greenhouse gas removals as in Regulation (EU) 2023/839 – Annex IIa. 
Source: Eurostat, EEA 

76 

Climate adaptation and preparedness:20182019202020212022202320182021Drought impact on ecosystems0.230.290.695.5855.480.266.772.76[area impacted by drought as % of total]Forest-fire burnt area (1)342          342          342          342          342          342          [ha, annual average 2006-2023]Economic losses from extreme events-           199          9              -           166          9 935       24 142       62 981       [EUR million at constant 2022 prices]Insurance protection gap (2)----1.88         1.88         [composite score between 0 and 4]Heat-related mortality (3)45            45            45            45            45            [number of deaths per 100 000 inhabitants in 2013-2022]Sub-national climate adaptation action37            46            48            51            51            52            4144[% of population covered by the EU Covenant of Mayors for Climate & Energy]Water resilience:20182019202020212022202320182021Water Exploitation Index Plus, WEI+ (4)0.60.60.60.50.6-4.54.5[total water consumption as % of renewable freshwater resources]Water consumption211          205          208          181          157          -           [million m3]Ecological/quantitative status of water bodies (5)[% of water bodies failing to achieve good status]Surface water bodies-------59%Groundwater bodies-------93%Biodiversity and ecosystems:20182019202020212022202320182021Conservation status of habitats (6)38.2-----14.7-[% of habitats having a good conservation status]Common farmland bird index79.076.981.676.373.9-72.274.42000=100Protected areas---4041--26[% of protected land areas]Sustainable agriculture and land use:20182019202020212022202320182021Bioeconomy's added value (7)2 751       2 879       3 018       3 054       634 378     716 124     [EUR million]Landscape features----6              -[% of agricultural land covered with landscape features]Food waste--686871-[kg per capita]Area under organic farming10.010.410.310.811.17.99-[% of total UAA]Nitrogen balance43.443.231.748.5--[kg of nitrogen per ha of UAA]Nitrates in groundwater (8)14.412.612.514.1--[mgNO3/l]Net greenhouse gas removals from LULUCF (9)804          641-          397-          321-          169-          -           256 077-     240 984-     [Kt CO2-eq]SloveniaEU-27SloveniaEU-27SloveniaEU-27SloveniaEU-27 
 
  
 
FAIRNESS 
ANNEX 10: LABOUR MARKET 

in 

the 

to 
Slovenia’s 
labour  market  continues 
perform  well,  but  challenges  remain. 
In 
particular,  labour  shortages  paired  with  skills 
mismatches,  perpetuated  by  an  ageing  workforce 
and the underrepresentation of some groups in the 
labour  market,  disincentives 
taxation 
system,  as  well  as  the  slow  adoption  of  the 
workforce  to  the  digital  and  green  transitions 
negatively  impact  the  country’s  competitiveness 
and  growth  potential.  As  Slovenia  works  towards 
its  2030  employment  rate  target,  harnessing  the 
potential  of  underrepresented  groups,  and 
addressing skills mismatches and labour shortages 
will  be  key  challenges  to  overcome  for  a  more 
robust  and  inclusive  labour  market  and  a  thriving 
economy. 

Graph A10.1: Key labour market indicators 

Source: Eurostat, LFS [lfsi_emp_a, une_rt_a, une_ltu_a, 
lfsi_neet_a]  

high 

employment 

labour  market  has  remained 
Slovenia’s 
and 
robust,  with 
historically  low  unemployment  rates.  Against 
a  backdrop  of  modest  real  GDP  growth,  the 
employment  and  activity  rates  (20-64)  in  2024 
recovered to levels similar to those seen in 2022, 
reaching  78.3%  and  81% 
respectively.  The 
employment  rate  remained  well  above  the  EU 
average (75.8%) and increased by 2.4 percentage 
the 
points 
unemployment  rate,  at  3.7%,  remained  far  below 
the  EU  average  (5.9%)  and  on  par  with  the 
positive 
previous 

to  2019,  while 

(pps)  compared 

generally 

These 

year. 

developments suggest that Slovenia is on the right 
track  in  terms  of  reaching  its  employment  rate 
target of 79.5% by 2030.  

in 

ICT 

rates 

issues 

job-vacancy 

the  EU  average 

in  the  Slovenian 

Labour  shortages  and  skills  mismatches  are 
critical 
labour 
market,  particularly  given  an  ageing 
population  and  declining  birth  rates.  At  2.3% 
in  2024, 
industry, 
construction  and  services  decreased  slightly  (0.4 
pps)  compared  to  the  year  before  but  remained 
around 
(2.4%).  Vacancies 
remained  particularly  high  in  construction  (4.9%) 
and  services  (2.9%).  Around  half  of  employers 
were  facing  difficulty  finding  suitable  workers  in 
2024. There are shortages of both vocational (e.g. 
truck  drivers,  cooks  and  caregivers)  and  tertiary-
educated  workers 
professionals, 
(e.g. 
engineers,  healthcare  and  education  staff) (180), 
which limit productivity gains. These shortages are 
especially  acute  in  sectors  such  as  construction, 
tourism,  transport,  healthcare,  long-term  care, 
education  and  ICT.  Slovenia  has  some  of  the 
highest  labour  market  imbalances  in  the  EU,  with 
both severe shortages and surplus occupations at 
the  same  time (181).  Employers  in  construction 
(58%),  manufacturing  (40%)  and  services  (37%) 
report  shortages  –  more  than  twice  the  EU 
average (182).  Despite  its  low  unemployment  rate, 
Slovenia 
to  over-
related 
the  macroeconomic  skills 
qualification,  with 
mismatch exceeding the EU average in 2024 (see 
Annex  12).  At  the  same  time,  life  expectancy  is 
increasing,  birth  rates  are  declining,  and  net 
migration is influenced by the economic cycle and 
labour  shortages.  Between  2022  and  2070,  the 
working-age  population  is  projected  to  fall  by 
16%, and the proportion of those with the highest 
activity rates (35-49) is expected to experience the 
steepest  drop 
the 
proportion  of  those  aged  65  and  above  is  set  to 
increase  by  34%  by  2070.  As  the  population  is 
ageing,  the  old-age  dependency  ratio  is  projected 
to  rise  from  36.1  in  2022  to  a  peak  of  60.3  in 
2050,  as  the  baby  boomer  generation  enters  old 

faces  challenges 

In  addition, 

(28%) (183). 

(180) Ibid., p. 59. 

(181) ELA, Labour shortages and surpluses in Europe, 2024 

(182) European Commission, Business and Consumer Survey. 

(183) Economic Policy Committee-Ageing Working Group, 2024 

Ageing Report Slovenia - Country Fiche, 2024. 

77 

010203040506070809005101520252009201020112012201320142015201620172018201920202021202220232024%%SIActivity rate 20-64 (rhs)Employment rate 20-64 (rhs)Unemployment rate 15-74 (lhs)Long-term unemployment rate 15-74 (lhs)Youth unemployment rate 15-24 (lhs)NEET rate 15-29 (lhs) 
 
 
  
 
 
 
age,  and  reach  57.5  in  2070.  These  demographic 
shifts  will  exacerbate  labour  market  tightness, 
underscoring  the  urgency of  activating  and  better 
integrating  underrepresented  groups  as  well  as 
foreigners.  The  ageing  population  will  also  put 
further  pressure  on  the  healthcare  and  long-term 
care  systems,  which  face  shortages  (see  Annex 
11). 

high 

In  this  context,  the  low  labour  market 
participation  of  vulnerable  groups  such  as 
older  people, 
low-qualified  workers  and 
persons  with  disabilities  can  hold  back 
economic growth. Slovenia has one of the lowest 
employment rates for older workers (55-64) in the 
EU (56.3% vs 65.2% in 2024), particularly among 
those with lower levels of qualifications (40.6% vs 
in  2024).  Older  people  also 
49.6% 
face 
long-term 
persistently 
levels 
unemployment, 
total 
unemployment in  2024.  The  employment  rate  for 
adults  with  lower  qualifications  (54.9%  in  2024) 
has  steadily  increased  since  2020  (47.4%)  but 
remains  below  the  EU  average  (58.7%).  The 
disability  employment  gap  narrowed  from  21.7 
pps in 2020 to 14.2 pps in 2024 (EU: 24) and is he 
lowest  in the EU. Nearly  a third of young persons 
with disabilities are neither in employment, nor in 
education  or  training  (NEETs)  (27%,  2022) (184). 
Slovenia  has  yet  to  set  a  target  for  the 
employment of persons with disabilities.  

comprising  39.6%  of 

of 

other  types  of  contracts.  As  a  result,  in  2022, 
Slovenia  had  one  of  the  largest  proportions  of 
students aged 20, 22 and 24 in tertiary education 
in  the  EU.  In  2020,  only  56.1%  of  students  who 
entered  a  bachelor’s  or  equivalent  programme 
completed  it  within  the  notional  duration  of  the 
programme  or  within  three  years  of  its  end.  
Number  of  young  people  working  in  occupations 
that do not match their field of study is one of the 
highest  in  the  EU  and  nearly  a  quarter  (20.8%  in 
2024) of young people with tertiary education are 
employed in jobs below their qualifications.   

the 

and 

low-skilled 

Slovenia  makes  use  of  the  European  Social 
Fund  Plus  (ESF+)  to  support  active  labour 
market  measures,  focusing  on  young  people 
and vulnerable groups, such as older workers 
and 
long-term 
unemployed. The ESF+ supports the development 
of  a  platform  for long-term  skills  forecasting  and 
for raising the quality of the working environment 
and  working  conditions.  The  purpose  of  this  is  to 
extend  the  working  lives  of  older  people  and  to 
promote  intergenerational  cooperation,  with  a 
focus  on  the  exchange  of  knowledge  and  skills 
between  generations.  As part  of  the  recovery  and 
resilience  plan,  Slovenia  has  committed 
to 
adopting  pension  reform  and  changes  to  the 
unemployment  benefits  legislation  in  order  to 
promote  longer  working  lives  and  to  reduce  the 
gap between the age at which people stop working 
and the statutory retirement age.  

Young  people  also  face  challenges 
in 
entering  the  labour  market.  The  proportion  of 
NEETs (15-29) continues to be one of the lowest in 
the  EU.  However,  at  10.9%  in  2024  (14.%  in  EU), 
the  youth  unemployment  rate  (15-24)  remains 
significantly  higher  than  that  of  the  overall 
population  (3.7%  in  2024)  and  increased  by  1  pp 
compared  to  2023.  Similarly,  while  precarious 
employment 
is  decreasing,  36.3%  of  young 
workers  (15-29)  are  employed  on  temporary 
contracts  (EU:  33.3%).  Slovenian  students  tend  to 
enter  the  labour  market  around  two  years  later 
than  their  peers  in  other  Member  States.  This  is 
largely  due  to  the  prevalence  of  student  work, 
which,  uniquely  in  the  EU,  is  driven  by  specific 
social  security  arrangements.  This  system  may 
deter people from entering work at an earlier age, 
as it is more beneficial for students and employers 
to use what are known as ‘student referrals’ than 

(184) European Commission, European comparative data on 

persons with disabilities, 2024 

from 

talent, 

faster 

particularly 

integration  of 

Ensuring 
foreign 
workers  in  the  labour  market  and  society  is 
essential for  addressing  labour shortages.  In 
addition  to  reducing  brain  drain  and  promoting 
circular  migration,  fostering  legal  migration  and 
attracting 
third 
countries, may be increasingly needed to maintain 
adequate human capital in key sectors and bolster 
Slovenia’s 
Foreign-born 
workers currently make up 15% of the workforce, 
with  the  largest  proportion  employed  in  catering, 
construction,  warehouses  and 
logistics.  Since 
2019, 
the  number  of  foreign  workers  has 
increased  by  48.7%.  Most  of  these  workers  are 
low-skilled,  as  nine  out  of  ten  have  at  most 
primary school education and more than one third 

competitiveness (185). 

(185) IMAD, Development report 2024. The supply of Slovenian 
specialists is also decreasing, as they migrate to other 
countries to find professional and career development and 
promotion opportunities abroad.  

78 

 
 
 
are  on  the  minimum  wage.  To  address  labour 
shortages  more  effectively,  Slovenia  has  adopted 
a strategy for (economic) immigration and several 
measures to facilitate the employment of non-EU 
nationals.  These  measures  also  include  issuing 
work  permits  more  quickly,  partly  in  response  to 
recurring  complaints 
from  employers  about 
lengthy  administrative  procedures.  Although  there 
has been some improvement, a significant backlog 
of applications from foreign workers remains (186), 
and it would be helpful to adopt further measures 
to 
the  challenges  of  attracting  and 
facilitating the integration of foreign nationals into 
society. 

tackle 

Graph A10.2: Low-wage and inactivity trap 

market. Similarly, when transitioning people move 
to higher-paid jobs or increase their working hours 
- e.g. increasing a second-earner’s wage from 33% 
to 66% of the median income in a similar setting - 
43.1%  of  the  additional  income is lost. While  this 
is  already  significantly  lower  than  in  the  past,  it 
remains  well  above  the  EU  average  of  37.6%.  In 
this case, explicit taxation and social contributions, 
account for 37.9% of the additional income. These 
traps  discourage  people  from  entering  work, 
especially  those  with  a  lower  level  of  education, 
who are more likely to hold low-paid jobs. Labour 
taxation  has  undergone  some  changes  in  recent 
years,  but  high  taxes,  social  contributions  and 
sometimes lower social transfers continue to deter 
single  parents  and  second  earners,  often  women, 
from seeking work or increasing working hours. To 
address  these  issues,  it  would  be  beneficial  to 
reduce marginal effective tax rates for low-income 
earners  and  second  earners  by  withdrawing 
benefits  and  social  assistance  in  a  more  gradual, 
coordinated manner. Moreover, better alignment of 
the  tax  and  social  transfer  system  could  help 
mitigate the severity of the low-wage trap. 

Source: European Commission, DG ECFIN, Tax and benefits 
database, based on OECD tax/benefit model (April 2024). 

living 

Slovenia  faces  significant  low-wage  and 
inactivity  traps  which  affect  both  single 
in  multi-person 
people  and  those 
households,  especially  women.  In  2023,  a 
person  moving 
into  work  from  a  period  of 
inactivity,  thus  becoming  the  second  earner  at 
67%  of  the  average  wage  in  a  family  with  two 
children  and  a  principal  earner  on  the  average 
wage,  had  48.1%  of  their  income  implicitly  taxed 
away,  compared  to  32.5%  in  the  EU  (see  Graph 
A8.2).  A  third  of  this  income  is  taxed  away  by 
explicit taxation, while the rest is accounted for by 
withdrawn benefits. As a result, Slovenia’s taxation 
structure  may  deter  second  earners,  particularly 
women,  from  taking  a  full  part  in  the  labour 

eroding 

outpaces 

Robust wage growth has led to a recovery in 
real  wages  which 
labour 
productivity, 
competitiveness. 
Nominal  wage  growth  is  projected  to  reach  5.6% 
in  2025,  compared  with  5.0%  in  2022,  9.5%  in 
2023 and 6.2% in 2024. Real wages increased by 
4.1% in 2024 and are projected to rise by 2.2% in 
2025,  after  a  significant  decline  in  2022  (3.7%) 
and a partial rebound in 2023 (2.3%) (187). This has 
led to overall real wage growth of 4.9% during the 
period  2022-2025.  The  statutory  minimum  wage 
rose  by  nearly  19%  between  January  2022  and 
April  2025,  with  a  real  increase  of  around  3%. 
Slovenia has a high concentration of workers paid 
close  to  the  minimum  wage.  In  2022,  64%  of 
employees  were  paid  below  the  average  wage, 
with  9.5%  earning  the  minimum  wage.  This 
included almost a fifth of young people, the same 
levels  of 
proportion  of  workers  with 
educational  attainment,  and  around  one  in  three 
foreign  workers (188).  Frequent  and  substantial 
increases 
in  the  minimum  wage  can  cause 
spillover effects on other wages (to maintain wage 

lower 

(186) These delays are driven by factors such as understaffing, low 
wages, complex legislation and high employee turnover. 
Foreign cases rose sharply from 125 000 in 2019 to 
189 000 in 2023, with first work permits expected to 
increase from 20 000 to 30 000 by 2024. 

(187)Based on the European Commission Autumn 2024 economic 

forecast. 

(188) IMAD, Development report 2024. In 2018, Slovenia had one 
of the highest proportions of employees earning up to 105% 
of the minimum wage (around 15% of all employees).  

79 

0.010.020.030.040.050.060.0Inactivity trap - second earner - 67% averagewageContribution of taxationLow-wage trap, wage increase from 33% to 66%average wageContribution of taxation (incl. SSC)EUSI 
   
 
 
ratios)  and  have  a  negative 
impact  on 
competitiveness  if  not  matched  by  productivity 
gains. In 2024, Slovenia adopted a comprehensive 
public sector wage reform which lifted  the lowest 
basic  wages  to  the  level  of  a  minimum  wage, 
restore  wage 
restructured  salary  scales 
competitiveness  with  the  private  sector  and 
created a more attractive working environment.  

to 

Slovenia’s  transition  towards  a  green  and 
digital  economy  is  hindered  by  skills  gaps 
and the absence of a comprehensive strategy 
for  green  jobs.  In  2024,  employment  in  the 
country’s energy-intensive industries accounted for 
4.1%  of  total  employment,  while  the  number  of 
jobs  in  the  green  economy  increased  modestly. 
Between  2016  and  2022,  employment  in  the 
environmental  goods  and  services  sector  grew  by 
18.6%,  reaching  3.2%  of  total  employment  (EU: 
3.3%). In turn, the job-vacancy rate in construction, 
a key sector for the green transition, is well above 
the EU average (4.9% vs 3.1% in 2024). In 2022, 
labour shortages were reported in 66 occupations 
that  required  specific  skills  or  knowledge  for  the 
green  transition,  including  insulation  workers,  civil 
engineering technicians and civil  engineers. At the 
same  time,  in  2023,  digital  skills  proficiency 
among  the  general  public  remained  limited  and 
almost  four  out  of  five  Slovenian  businesses 
reported  difficulties  in  recruiting  ICT  specialists. 
Around  3 000-4 000  ICT  specialists  per  year  are 
needed  to  reach  the  Digital  Decade  target  (see 
Annex  12).  This  shortage  is  impeding  a  faster 
transition 
to  a  smart  green  economy  and 
hampering  productivity  growth.  The  greenhouse 
gas  emission  intensity  of  the  country’s  workforce 
has  improved,  decreasing  from  13.6  tonnes  per 
worker  in  2015  to  10.2  in  2023  (EU:  12.3), 
reflecting  progress  on 
transition. 
Upskilling  and  reskilling,  including  for  those  worst 
affected,  and  promoting  an 
labour 
market are essential policy levers for speeding up 
the transition to a net-zero economy and ensuring 
its fairness. Slovenia lacks a systematic horizontal 
approach towards green jobs and green skills and 
would  benefit  from  a  more  structured  strategy. 
The  concept  of  green  skills  has  not  been  defined 
yet,  which  negatively  impacts  the  efforts  of  the 
Public Employment Services to provide training. 

the  green 

inclusive 

80 

 
 
 
ANNEX 11: SOCIAL POLICIES 

Slovenia  has  a  well-functioning  welfare 
system,  with  one  of  the  lowest  at-risk-of-
poverty rates in the EU along with one of the 
lowest income and wealth inequalities, but it 
continues  to  face  challenges  related  to 
poverty  and  social  exclusion,  particularly 
among vulnerable groups and in rural areas, 
especially 
in  eastern  Slovenia.  The  key 
contributing  factors  to  these  challenges  include  a 
less  diverse  economy,  especially  in  rural  areas, 
coupled  with  more  limited  access  to  quality  jobs, 
healthcare, education, social services and essential 
lack  of  affordable 
services. 
housing,  especially  in  the  capital  and  other  urban 
areas where jobs are concentrated, has a negative 
impact on labour mobility, on the attractiveness of 
the country for foreign workers and, consequently, 
on productivity. Demographic shifts raise concerns 
for  the  sustainability  of  the  pension  and  care 
systems.  The  limited  capacity  of  the  healthcare 
and  long-term  care  system,  including  uneven 
access  to  quality  services  across  regions,  and 
housing  affordability  pose  risks  to  Slovenia’s 
sustainable and inclusive growth and prosperity. 

In  addition,  the 

Graph A11.1: AROPE rate and its components 

equivalent  to  302 000  individuals,  representing  a 
move  away  from  the  2030  national  target. 
Slovenia has committed to reducing the number of 
people  AROPE  by  9 000,  including  3 000  children, 
compared to 2019 levels. In light of the increase, 
Slovenia now has to reduce the number of people 
AROPE  by  32  000  by  2030.  For  children,  the 
AROPE  rate  reached  11.8%  in  2024  but  still 
remains the lowest in the EU. However, for children 
of  parents  with  a low  level  of  education, the  rate 
was 62.6%, above the EU average of 61.2%. Since 
2021, monetary poverty also rose and the at-risk-
of-poverty  (AROP)  rate  increased  from  11.7%  in 
2021  to  13.2%  in  2024.  After  decreasing  rapidly 
between  2015  and  2022,  the  percentage  of 
people  affected  by  severe  material  and  social 
deprivation increased in 2023 on the back of high 
inflation  in  2022  and  stands  at  1.8%  in  2024  
(around  36 000  people)  .Lastly,  around  10 000 
people  were  exposed  to  all  three  forms  of  social 
exclusion (189).  Slovenia 
the 
European  Child  Guarantee  (ECG)  as  part  of  its 
2023 action plan. The 2024 implementation report 
shows that progress was made in some areas, e.g. 
social  inclusion  of  Roma  children  and  support  for 
Roma  families  as  well  the  creation  of  child  and 
adolescent  mental  health  centres  at  primary 
healthcare  level.  At  the  same  time,  additional 
measures could help counteract staff shortages in 
social  services  and  support  single  parents  and 
children  in  alternative  (especially  institutional) 
care. The implementation of the ECG is supported 
by EU cohesion policy funds including through the 
creation  of  preventive  programmes  to  ensure 
access  to  services  and  social  inclusion.  In  light  of 
the  worsening  trend  regarding  the  number  of 
AROPE  people,  further  measures  are  needed  to 
achieve  the  2030  national  target  on  poverty 
reduction. 

implementing 

is 

Slovenia  has  a  strong  social  protection 
system,  but  higher  poverty  risks  among 
vulnerable  groups  remain  a  challenge.  Some 
vulnerable groups remain at a much higher risk of 
poverty and social exclusion, such as single-person 
households  (39.3%  in  2024).  The  AROPE  rate  of 
older  people  (65+)  is  significantly  above  the  EU 
average  (23.3%  vs  19.4%  for  the  EU),  but  much 
higher for older women than for older men (26.8% 
and  19%,  respectively).  At  the  same  time,  the 
unemployed  (56.6%),  people  born  outside  the  EU 
(23.8%),  persons  with  disabilities  (24.4%)  and 

(189) IMAD, Development report 2024, p. 182. 

Source: Eurostat, EU-SILC [ilc_peps01n, ilc_li02, ilc_mdsd11, 
ilc_lvhl11n] 

Slovenia  has  one  of  the  lowest  rates  of 
people  at  risk  of  poverty  or  social  exclusion 
(AROPE) in the EU, even though the rate has 
been rising in recent years. In 2024, the AROPE 
rate  both  for  the  overall  population  and  for 
children  increased  by  0.7 and  1.1  percentage 
points  (pps),  respectively.  Rising  for  the  third 
consecutive  year,  the  AROPE  rate  reached  14.4%, 

81 

024681012141618202015201620172018201920202021202220232024% of populationSIAt-risk-of-poverty or social exclusion rate (AROPE)At-risk-of-poverty or social exclusion rate of children >18 (AROPE)At-risk-of-poverty rate (AROP)Severe material and social deprivationPeople living in low work intensity households 
 
   
 
 
 
tenants renting at market prices (26.9%) also face 
higher  AROPE  risks  than  the  general  population. 
This  might  be  driven  by  the  negative  impact  of 
high energy prices and inflation in recent years on 
pensions  and  wages.  As  there  is  also  a  high 
proportion  of  households  and  individuals  just 
above  the  poverty  threshold,  particular  policy 
attention  is  warranted.  In  this  context,  the impact 
of  social  transfers  (other  than  pensions)  on 
poverty  reduction  has  significantly  declined  from 
44.8% in 2021 to 37.7% in 2024. Around EUR 237 
million  from  the  European  Social  Fund+  (ESF+)  is 
for 
improving  social 
allocated 
vulnerable  groups.  This  includes  improving  social 
services’  accessibility  and  quality  (with  learning 
and digital skills workshops), supporting healthcare 
for 
services 
minorities and people with disabilities. 

implementing  measures 

inclusion 

and 

to 

low: 

Slovenia 

demonstrates 

energy  poor,  decarbonising  district  heating 
systems  and  transitioning  away  from  outdated 
biomass heating technologies. Transport poverty is 
also 
strong 
affordability for car ownership, even among lower-
income groups. The percentage of Slovenians who 
could  not  afford  a  car  was  2.1%  in  2024,  well 
below  the  EU  average  of  5.6%.  Similarly,  the 
percentage of people at risk of poverty who cannot 
afford  a  car  was  9.8%  in  2024  –  below  the  EU 
average  of  15.9%.  However, 
the  continued 
dominance of personal cars and the stagnation in 
in 
public 
promoting sustainable and inclusive transportation 
systems.  These 
challenges  may  be  more 
pronounced in rural areas where the largest share 
of  people  reside  (45.1%)  compared  to  towns, 
suburbs and cities. 

transport  use  highlight  challenges 

Employment  status  plays  an  important  role 
in  determining  poverty  risks,  and  in-work 
poverty  is  increasing.  The  in-work  at-risk-of-
poverty  rate  decreased  by  0.3  pp  to  5.4%  in 
2024(8.2%  in  the  EU),  exceeding  pre-pandemic 
levels  (4.5%  in  2019).  The  rate  among  men  rose 
from  5.4%  in  2023  to  5.9%  in  2024,  while  for 
women,  it  remained  steady  compared  to  2023 
(4.8%).        Between  2014  and  2022,  the  poverty 
risk for temporary workers decreased significantly 
from  14.6%  to  3.4%.  However,  it  increased  again 
to 10.8% in 2023 and stood at 6.3% in 2024. For 
part-time  workers,  the  AROP  rate  was  10.6%  in 
2024.  The  self-employed  continue  to  face  the 
highest  risk,  at  23.8%  in  2024,  although  this 
represents  an  improvement  from  27.9%  in  2013. 
In  2022,  those  with  a  migrant  background  faced 
significantly  higher  poverty  risks,  yet  still  below 
the EU average. 

Energy  and  transport  poverty  are  low.  In 
2024,  only  3.3%  of  the  population  struggled  to 
keep  homes  warm,  well  below  the  EU  average  of 
9.2%.  In  contrast,  6.7%  of  individuals  faced 
arrears  on  utility  bills  in  2024,  which  marks  an 
improvement  of  2.7 pps  compared  to  2020  (EU 
average  6.9%).  To  address  energy  poverty, 
Slovenia  has  introduced  a  range  of  measures 
including financial incentives to support vulnerable 
households, such as replacing old solid fuel boilers 
with wood biomass boilers and protecting against 
disconnection  from  the  grid.  Slovenia  has  also 
adopted a national action plan to alleviate energy 
poverty  for  2024-2026,  with  an  allocated  budget 
of EUR 34 million focusing on structural measures 
such  as  energy-efficiency  renovations  for  the 

82 

The  amended 

An  ageing  population  poses  a  significant 
challenge  for  the  future  adequacy  and 
sustainability of the pension system. With the 
65+ age group accounting for an increasing share 
of  the  population,  which  is  expected  to  rise  by 
34%  between  2022  and  2070,  the  old-age 
dependency  ratio  is  also  projected  to  increase 
from 36% in 2022 to about 57.5% in 2070, after 
peaking  at  around  61%  in  2059.  The  ratio  of 
individuals  to  pensioners  already 
working-age 
decreased from 1.57 in 2023 to 1.55 in 2024. The 
ongoing  reform  of  the  public  pension  system,  as 
part  of  the  recovery  and  resilience  plan  (RRP),  is 
expected  to  have  a  positive  effect  on  the 
adequacy,  especially  of  the  lowest  pensions,  and 
on  the  financial  sustainability  of  the  pension 
legislation 
system. 
(adoption  expected  in  2025)  aims  to  increase  the 
statutory retirement age from 60 to 62 for those 
who have been working for 40 years, and from 65 
to 67 for everyone else. The legislation also plans 
to  increase  the  accrual  rate  from  63.5%  to  70% 
for 40 years of work and to 30% for 15 years of 
work.  Further  changes  are  envisaged  as  regards 
pension  adjustment  to  closer  link  pensions  to 
inflation,  the  aim  being  to  maintain  the  level  of 
benefits  and  thus  ensure  the  social  security  of 
pensioners.  As  single  pensioners,  especially 
women,  are  among  the  most  vulnerable  groups 
with  the  highest  AROP  rates,  the  reform  proposal 
includes  raising  survivors’  pensions  from  70%  to 
80%.  As  a  result,  pension  adequacy  could  be 
significantly  improved.  While  various  measures, 
such  as  the  guaranteed  pension  for  40  years  of 
work  and  pension 
indexation,  contributed  to 
growth in real pensions in recent years, challenges 

pension 

 
remain.  In  particular,  these  pertain  to  certain 
groups of pensioners (190)  who continue to receive 
very  low  pensions.  Approximately  half  of  the 
pensioners  in  Slovenia  receive  a  pension  that  is 
below  the  poverty  threshold (191).  The  impact  of 
social  transfers  (other  than  pensions)  in  reducing 
poverty was lowest among older individuals (65+), 
with  the  AROPE  rate  among  women  aged  75+ 
being almost twice as high as that of the general 
population.  At  43%, 
the  aggregate  pension 
replacement  ratio  in  Slovenia  is  below  the  EU 
average  of  61%  in  2024,  as  are  median  relative 
incomes  of  people  aged  65+  (78%  compared  to 
90%) (192). 

professionals  is  approximately  50,  and  55  in  the 
case of social  workers. In 2023, Slovenia adopted 
a  national  deinstitutionalisation  strategy  which 
aims  to  transform  22  institutions  by  2034  and 
provide  community  alternative  care  to  around 
3 416 persons currently living in institutions. 

Graph A11.2: Housing deprivation 

care 

recent 

comprehensive 

capacity.  The  most 

Despite 
reforms, 
challenges  in  the  areas  of  long-term  care 
and  social  care  persist.  At  a  structural  level, 
important  reforms  and  legislative  changes  have 
already been made since 2022. However, there is 
a  significant  risk  that  key  long-term  care  (LTC) 
services  will  not  be  satisfactorily  operating  in  full 
by  the  2025  deadlines,  following  the  adoption  of 
the  LTC  act  in  2023.  Effective  implementation 
requires  adequate  administrative  procedures  to 
implement  the  new  LTC  system,  upgrading  or 
establishing care services, and especially boosting 
home 
important 
challenges  remain  access,  adequacy,  quality  and, 
especially, staff shortages and long-term financial 
sustainability.  In  terms  of  access,  the  challenges 
are twofold, especially in rural areas: (i) the limited 
availability of respite care and support for families 
and  carers  of  older  and  disabled  people,  and  (ii) 
the limited availability of specialised care for older 
people with complex needs. Another critical factor 
hampering  the  effective  provision  of  services  is 
staffing.  In  2023,  Slovenia  faced  staff  shortages 
(with many staff members leaving the sector due 
to  burnout  and  poor  working  conditions),  with  a 
shortage in the LTC sector of approximately 2 000 
caregivers,  and  in  the  social  care  sector  of 
approximately  1 000  social  workers.  The  lack  of 
staff  is  compounded  by  relatively  high  turnover 
rates  (15%  for  long-term  care  professionals,  and 
20% in the social care sector) as well as an ageing 
workforce.  In  Slovenia,  the  average  age  of  LTC 

(190) Pensioners with incomplete or short working lives, the self-
employed, people working in intermittent jobs, and those 
with a low level of contributions. See European Commission, 
2024 pension adequacy report, 2024. 

(191) ZPIZ, Annual Report 2023, p. 35. 

(192) Source Eurostat: ilc_pnp2 

83 

Source: Eurostat, [ilc_mdho01]. 

House  prices  have  increased  significantly 
over the last decade, rising by almost 100% 
since 2015. They increased by 7.2% in 2023 and 
7.4%  in  2024.  In  2021  and  2022,  house  prices 
grew 11.5% and 14.8%, respectively. At the same 
time, house prices are estimated to be only slightly 
overvalued.  Mortgage  rates  increased  from  1.8% 
in 2021 to 3.2% in 2024, after peaking at 4.0% in 
2023.  This  caused  mortgage  credit  to  decelerate 
and  grow  only  0.7%  in  2023  and  3.9%  in  2024. 
interest  rate 
The  adjustment  to  the  higher 
environment  has  resulted  in  a  lower  number  of 
transactions  (down  7.6% and  20.0%  in  2022  and 
2023  respectively).  Building  permits  remain  high 
when  compared  with  2015,  though  they  fell  by 
3.9% in 2023 and 11.5% in 2024. 

Overall  housing  affordability  deteriorated 
over  the  last  decade.  Since  2015,  house  price 
growth  has  exceeded  household  income  growth. 
The  standardised  house  price-to-income  ratio  has 
increased  by  17%.  It  stands  5%  above  its  long-
term average. While ownership rates are high due 
to  the  legacy  of  the  privatisation  of  state-owned 
properties,  housing  affordability  has  become  an 
issue, especially for first-time buyers. At the same 
time,  housing  supply  has  remained  limited.  The 
ratio of dwellings per capita has been stable over 
the past years but stands among the lowest in the 
EU.  Furthermore,  despite  an  increase  in  house 
completions over the past years, the ratio of house 
completions per capita is also among the lowest in 
the  EU.  Residential  building  permits  have  been 

05101520253035Households with depent children living in adwelling with a leaking roof, damp walls,floors or foundation or rot in windowframes or floorPopulation below 60% median incomeliving in a dwelling with a leaking roof,damp walls, floors or foundation or rot inwindow frames or floorPopulation living in a dwelling with aleaking roof, damp walls, floors orfoundation or rot in window frames or floorSloveniaEU 
 
     
lengthy  permitting 

decreasing  over  the  past  two  years  but  stand 
above  their  pre-pandemic  levels.  Spatial  planning 
constrain 
and 
systems 
construction  activity  and  housing 
investment 
remains 
low.  Furthermore,  rising  costs  have 
exacerbated  supply  constraints  and  affordability 
challenges in recent years. Taking into account the 
cost  of  mortgage  funding,  the  borrowing  capacity 
of  households  worsened  only  marginally  over  the 
past  decade.  While  the  rental  market  is  rather 
small, the ratio of new rents to incomes increased 
significantly over the last ten years. 

in 

low 

housing 

relatively 

include  the 

Despite 
cost 
overburden  rates,  affordable  housing  has 
been  a  long-term  challenge,  and  housing 
deprivation  is  among  the  highest  in  the  EU. 
Close to 75% of dwellings in Slovenia are owner-
occupied, keeping housing costs lower overall, with 
just  3.8%  of  the  population  facing  housing  costs 
above 40% of income (EU: 8.2%). However, access 
to  affordable  housing  is  becoming  increasingly 
problematic in Slovenia, and not just for vulnerable 
groups  but  also  for  young  families  and  first-time 
buyers.  In  2023,  there  was  a  shortage  of  around 
11 000  public  rental  apartments  in  Slovenia (193). 
Factors  contributing  to  this 
low 
urbanisation,  the  concentration  of  key  jobs  and 
limited  housing 
cities  and 
universities 
construction, leading to high homeownership rates. 
As a result, property prices and rents have soared, 
particularly  in  larger  cities (194).  This  means  that 
housing  costs  for  those  at  risk  of  poverty  and 
tenants renting at market prices are much higher, 
with  overburden  rates  of  20.6%  and  16.5% 
respectively. The lack of non-profit rental housing, 
the  underdeveloped  social  housing  sector  and the 
resulting  housing  market  shortages  together  with 
an underdeveloped capital market with real estate 
as a key asset for investment have contributed to 
high prices. Increasing public rental housing supply 
through  new  construction  or  renovating  vacant 
properties  could 
improve  affordability,  while 
under-occupied  dwellings  offer  untapped  housing 
potential. In 2024, more than one third (35.3%) of 
the population lived in such dwellings (EU 33.1%). 

young 

housing 

however, 

for 
groups, 

families 
the 

Under  its  RRP,  Slovenia  intends  to  purchase  or 
construct  nearly  5 000  non-profit  flats  by  2026 
(480  financed  by  the  Recovery  and  Resilience 
Facility  (RRF))  to  improve  access  to  non-profit 
rented 
and 
full 
disadvantaged 
implementation  is  to  be  monitored.  In  2023  and 
2024,  EUR 25.5  million  annually  have  been 
allocated to recapitalise the national housing fund, 
with  an  additional  EUR 60  million  from  the  RRF 
between  2023  and  2026.  Slovenia  intends  to 
systematically  finance  affordable  housing  with 
EUR 100  million  per  year  for  the  2025-2035 
period.  Slovenia  has  one  of  the  highest  levels  of 
housing  deprivation  in  the  EU.  At  18.5%  of 
households,  the  proportion  of  people  living  in  a 
dwelling with a leaking roof, damp walls, floors or 
foundation,  or  rot  in  the  window  frames  or  floor 
was  among  the  highest  in  the  EU.  The  number  is 
even  higher  for  the  lowest  income  households 
(29.3%  in  2023)  and  elevated  for  families  with 
is  particularly 
dependent  children.  The 
pronounced 
south-east 
Pomurska 
Slovenia  (195). Additionally, 10.6% of people live in 
overcrowded households, rising to 16.2% for those 
AROP.  Slovenia  plans  to  implement  a  strategy  to 
prevent and comprehensively address the problem 
of  homelessness.  The  latest  national  estimates 
found  that  3 545  individuals,  representing  0.17% 
of the total population, were homeless in 2022; of 
these, 27% were women and 73% were men (196). 

issue 

and 

in 

strategic 
has  an  ambitious 
Slovenia 
framework to address its social challenges. It 
is implementing the resolution on the 2022-2030 
national  social  assistance  programme  through 
national  action  plans,  multiple  sectoral  strategies 
and  other  measures.  If  implemented  effectively, 
these  policies  could  improve  the  efficiency  and 
effectiveness  of  social  protection.  This  includes 
modernising  and 
social 
reforming 
legislation, such as the Social Assistance Payments 
Act and the Exercise of Rights to Public Funds Act. 
Ensuring  a  proper  social  benefit  floor  involves 
recalculating  the  minimum  basic  income  more 
frequently.  As  regards  determining  social  benefit 
eligibility,  it  is  also  important  to  address  long-

complex 

(193) Government of Slovenia, Proposal for a strategy to prevent 

and end homelessness in Slovenia 2025-2035. 

(194) Between 2021 and 2024 rent in Ljubljana doubled from 

EUR 11 to EUR 22 per square metre. In 2024, the average 
rent for a 30 square metre studio was EUR 660 and for a 50 
square metre flat it was EUR 1100, while the minimum wage 
was EUR 902 net in 2024. 

(195) One of the main reasons for poor housing condition is the old 

and poorly maintained housing stock. About 80% of 
dwellings were built before 1990 and only about 2% 
between 2016 and 2021, with the highest share in the 
Osrednjeslovenska region and the lowest in the Zasavska 
region. See IMAD, Development report 2024. 

(196) OECD, Country notes on homelessness data. 

84 

 
 
 
standing  issues  in  the  information  system  of  the 
centres for social work. Additionally, resolving staff 
shortages at the centres for social work is crucial. 

85 

 
 
ANNEX 12: EDUCATION AND SKILLS 

in  a  context  of  wider 

The  decline  in  basic  skills  among  pupils, 
significantly  decreasing  adult 
learning, 
insufficient digital and green skills, alongside 
rising  skills  mismatches  and  shortages,  are 
adversely  affecting  competitiveness  and 
innovation.  Slovenia  is  increasingly  experiencing 
a shortage of adequately qualified staff and skills 
mismatches 
labour 
shortages.  Basic  skills  among  pupils  have 
deteriorated,  negatively  affecting  future  skills 
development.  At  the  same  time,  the  number  of 
adults  participating in  learning  overall  dropped by 
almost  20 percentage  points  (pps)  from  2016  to 
26.5%  in  2022  and  was  especially  low  among 
low-qualified  and  older  workers.  Further  efforts 
are needed to develop the necessary skills for the 
twin transition, including increasing the number of 
ICT  specialists.  On  a  positive  note,  the  number  of 
students  and  graduates  in  science,  technology, 
engineering,  and  mathematics  (STEM)  rose  over 
recent  years  and  Slovenia  has  a  well-developed 
system of vocational education and training (VET). 

foundation 

Participation  in  early  childhood  education 
and  care  (ECEC)  significantly  contributes  to 
for  skills 
building  a  solid 
development.  Slovenia’s  participation  rate  in 
ECEC  for  children  aged  between  three  and 
compulsory  primary  school  age  was  93.2%  in 
2023  (EU-27  average  94.6%).  Among  children 
under  the  age  of  3,  participation  in  formal 
in  20243  and 
childcare 
reached  57.8% 
significantly  exceeded  both 
the  EU  average 
(39.2%) and the national Barcelona target of 46%. 
However,  a  participation  gap  exists  between 
children  at  risk  of  poverty  (38.9%)  and  those  not 
at risk (58.3%), indicating that access barriers still 
persist.  In  some  regions,  the  lack  of  qualified 
teachers and assistants remains a challenge (197). 

in  2025/26 

An  updated  curriculum  for  ECEC  will  be 
in  all  public 
introduced 
is  to  enhance 
kindergartens.  The  objective 
quality, 
foster 
fairness 
promote 
multilingualism  and  multiculturalism,  while  also 
making  kindergarten  even  more  accessible,  with 
special  emphasis  on  the  enrolment  of  children 
from the most vulnerable groups (Roma children). 
To  attract  more  professionals  into  the  education 

and 

sector,  Slovenia  is  continuing  to  offer  internships. 
In 2024, a public call was issued for 80 internship 
positions in kindergartens and 170 in schools. 

The  recent  sharp  decline  in  basic  skills 
among  young  people  may  weaken  the  skills 
base  and  exacerbate  skills  shortages  in  the 
future.  The  percentage  of  early  leavers  from 
education  and  training  among  18-24-year-olds 
has  slightly  increased  over  the  last  decade  (from 
3.9%  in  2013  to  5%  in  2024)  but  remains  well 
below  the  EU  average  (9.3%  in  2024).  Between 
2018  and  2022,  however,  basic  skills  among  15-
year-olds  deteriorated (198),  which  poses  a 
challenge  for  skills  development  in  the  future.  In 
2022,  24.6%  of  15 year-olds  did  not  achieve  the 
minimum  level  of  proficiency  in  mathematics  (EU 
average:  29.5%)  and  26.1%  did  not  achieve  it  in 
reading  (EU  average:  26.2%).  While  between 
2015-18,  underachievement  was  close  to  the  EU 
level  target  of  15%,  it  rose  dramatically  in 
mathematics  and  in  reading  (both  by  8.2 pps) 
between  2018  and  2022.  School  closures  during 
the pandemic, a lack of teaching staff might have 
contributed to the decline in performance. Teacher 
shortages  have  been  on  the  rise  as  maintaining 
the  attractiveness  of  the  teaching  profession 
became a challenge. In 2022, approximately 42% 
of  students  in  Slovenia  attended  schools  where 
instruction was compromised by a lack of teaching 
staff (PISA 2022). 

Graph A12.1: Underachievement in basic skills 

Source: OECD, Programme for International Student 
Assessment (PISA) 2022. 

status 

significantly 
Socio-economic 
influences  educational  outcomes.  Whereas 
41% of students from the poorest income quartile 
in  mathematics  (EU  average: 
underperformed 

(197) Seepro3, ECEC Workforce Profile – Slovenia, 2024. 

(PISA) 2022. 

(198) OECD, Programme for International Student Assessment 

86 

05101520253035SloveniaEUSloveniaEUSloveniaEUReadingMathematicsScience201220182022 
 
 
 
  
 
 
 
48%),  only  9.9%  from  the  richest  quartile  did. 
Compared  to  2018,  the  share  of  disadvantaged 
students who underachieve increased by 13.7 pps 
(EU  average:  9.9 pps),  compared  to  4.1 pps  (EU 
average:  2.2 pps)  among  non-disadvantaged 
students.  Underachievement  was  higher  among 
those  born  abroad.  More  than  half  (51.2%)  of 
students  born  abroad  were  underperforming  in 
the  socio-economic 
mathematics.  Also  here, 
background  plays  a  key  role,  as  around  half  of 
students  with  a  migrant  background  face  socio-
economic disadvantage.  

Declining  top  performance  and  low  level  of 
creative thinking may impact the future pool 
of  innovative  talent.  The  top  performance  rate 
in  reading  among  15-year-olds  decreased  by 
3.3 pps,  currently  standing  at  4.4%,  compared  to 
the  EU  average  of  6.5%.  Slovenian  students  also 
demonstrated  weaker  performance  in  creative 
thinking,  with  a  top  performance  rate  of  16.3%, 
while  the  EU-23  average  was  25.1%  in  2022. 
Slovenia  is  taking  steps  to  improve  education 
outcomes,  but  implementation  is  at  early  stages. 
Slovenia’s  2023-2033  national  programme  for 
education  promotes 
reading 
culture,  and  developing  digital  literacy,  among 
other things. The recovery and resilience plan (RRP) 
has  earmarked  EUR 4.4. million  for  the  ongoing 
reform of the curriculum by 2025 and might help 
improve  reading  and  mathematics  skills,  also  for 
successful 
disadvantaged 
implementation  of  the  reform,  an  adequate 
preparation of teachers will be key and additional 
efforts might be needed. 

children. 

literacy, 

reading 

For 

a 

Reducing  teacher  shortages  and  increasing 
the attractiveness of the teaching profession 
could  help  increase  the  quality  of  education 
and  strengthen  basic  skills.  While  at  present 
there  is  no  comprehensive  system  for  monitoring 
and  forecasting  teacher  shortages,  schools  report 
increasing difficulties in organising lessons. Based 
on  an  internal  survey  in  2023,  the  Association  of 
Principals  and  Assistant  Principals  estimates  that 
around  5 000  teaching  posts  (from  kindergartens 
to  upper  secondary  schools)  were  unfilled  or  not 
appropriately  filled.  Addressing  teacher  shortages 
and  increasing  the  attractiveness  of  the  teaching 
profession  requires  concerted  efforts,  such  as  a 
initial  teacher 
issues 
strategy  addressing 
education, entry pathways and the social status of 
the  profession.  Slovenia  has  already  taken  some 
measures, 
including  simplifying  the  teachers’ 
recruitment  procedure  and  introducing  a  new 

in 

87 

salary  law,  negotiated  with  public  sector  trade 
unions (199).  However,  challenges 
in 
particular for subjects linked to STEM (200). 

remain, 

Slovenia  has  a  well-developed  system  of 
VET,  but  additional  efforts  are  needed  to 
improve alignment with labour market needs. 
With  around  6  in  10  upper  secondary  students 
taking  part  in  VET  programmes  in  the  2024/25 
school  year,  VET 
is  a  popular  choice  for 
students (201). At 80.6% (202), the employment rate 
of recent VET graduates is high and slightly above 
the  EU  average  (80%).  In  the  context  of  a  tight 
labour  market,  however,  employers  are  struggling 
to find workers with vocational education (203). This 
is in part also driven by a high proportion of young 
people  opting  for  tertiary  education  after  VET 
upper  secondary  school  and  an  underdeveloped 
apprenticeship  system.  In  recent  years,  only  a 
small number of 1st-year VET students decided to 
do  an  apprenticeship.  Despite  the  growth  of 
apprenticeship  programmes  and  partners  schools, 
apprentice  numbers  remain  stagnant.  This 
is 
primarily  because  apprenticeships  are  completed 
under  a  student  status  rather  than  an  employee 
status.  There  are  also 
finding 
employers.  Larger  companies  capable  of  offering 
comprehensive  professional  training  are  scarce, 
while  smaller  companies  often  lack  the  resources 
necessary to train apprentices. 

challenges 

for 

system 

the  VET 

is  working  to 
In  this  context,  Slovenia 
prepare 
future 
challenges. Slovenia’s RRP includes measures for 
modernising  upper  secondary  vocational  and 
technical  education,  such  as  apprenticeships, 
strengthening  cooperation  between  the  education 
system  and  the  labour  market,  reforming  the 
curriculum of higher vocational study programmes, 
and including digital and green skills in all updated 
VET  programmes (204).  To  increase  young  people’s 
interest  in  VET,  the  Institute  of  the  Republic  of 
Slovenia  for  Vocational  Education  and  Training  is 

(199) The salaries of public sector employees will increase by 19% 

on average and by 28% for trainee teachers. 

(200) See Education and Training Monitor 2024 - Slovenia. 

(201) Statistical Office Slovenia, Students in pre-tertiary education, 

school years 2024/2025 and 2023/2024 

(202) EUROSTAT data for 2024 is flagged as unreliable. 

(203) IMAD, Development report 2024, p. 156. 

(204) The objective is to renew 25 upper secondary and 16 higher 

VET programmes by the end of 2026. 

 
 
and 

competitions 

carrying out  a project to achieve greater visibility, 
attractiveness and competitiveness of VET through 
promotional activities, such as the presentation of 
professions 
in 
schools, 
professional  skills,  and  promotion  of  deficit 
professions.  A  European  Social  Fund  Plus  (ESF+)-
funded  project  for  the  acquisition  of  basic  and 
vocational skills aims to improve their core skills in 
responding  to  technological,  demographic  and 
climate change in modern society. ESF+ funding is 
also  invested  in  the  expansion  of  apprenticeships 
and career guidance for young people. 

increasing 

Further 
tertiary  educational 
attainment  could  help  meet  the  demand  for 
highly skilled professionals. Between 2022 and 
2035,  employment  in  high-tech  manufacturing 
and  knowledge-intensive  services  in  Slovenia  is 
predicted  to  register  one  of  the  highest  growth 
rates  in  the  EU,  requiring  a  highly  qualified 
workforce (205).  The  share  of  tertiary-educated 
people aged 25-34 increased from 35.3% in 2012 
to  43.1%  in  2024 (206),  slightly  below  the  EU 
average of 44.2% and the EU-level target at 45%. 
The gender gap in tertiary educational attainment 
in favour of women remained one of the highest in 
the  EU  in  2024  (23.7 pps  vs  11.2 pps  in  the  EU). 
Narrowing this gap could help meet labour market 
demands.  At  the  same  time,  the  share  of  tertiary 
graduates in STEM has also increased. Since 2016, 
the proportion of STEM graduates rose by 4.5 pps 
to 29.5%, surpassing the EU average of 26.6% in 
2022.  Among  medium-level  VET  pupils,  around 
42.1%  were  enrolled  in  STEM  fields  in  2023 
compared to 36.3% in the EU. 

needs 

future 

employment 

Slovenia 
increasingly  experiences  skills 
mismatches  and  shortages  of  skilled  labour, 
while 
are 
estimated  to  predominantly  require  high-
level qualifications. Vacancy rates stood around 
EU  average  in  2024  (see  Annex 10),  however 
labour shortages driven by demographic shifts and 
a  robust  economic  expansion  in  recent  years 
remain  pronounced  in  certain  sectors  More  than 
half of companies (55.8%) and almost 9 out of 10 
large  companies  (85.1%)  also  faced  shortages  of 
suitably qualified staff (207). Employers’ difficulties 
in  finding  suitable  workers  are  exacerbated  by 

(205) CEDEFOP (n.d.), Employment growth in high-tech economy. 

(206) Change in methodology in 2023. 

(207) IMAD, Productivity report 2023. 

88 

in 

the 

education, 

The  macroeconomic 

knowledge  and 
mismatches 
skills 
competencies. 
mismatch,  highlighting 
relatively  higher 
difficulty  of  people  with  low-  and  medium-level 
qualifications  in  entering  the  labour  market,  as 
compared to highly qualified people, has increased 
over the last decade and exceeded the EU average 
in 2024, where it decreased over the same period. 
At  the  same  time,  in  2024,  20.8%  of  those  with 
in 
tertiary  education  (25-34)  were  employed 
occupations  requiring  at  most  upper  secondary 
education 
(EU:  21.2%).  Shortages  of  digital 
specialists  and  engineers  are  particularly  acute. 
This 
in  turn  hinders  a  faster  transition  to 
innovation-led  growth.  Specialists  are  lacking  in 
ICT,  healthcare,  education  and  social  sciences. 
These shortages of skilled labour are projected to 
become more acute in the years ahead. According 
to  the  European  Centre  for  the  Development  of 
Vocational  Training  (CEDEFOP),  Slovenia’s  future 
employment  needs  from  2022  to  2035  will 
demand  a  workforce  with  high  qualifications (208). 
By  2035,  it  is  anticipated  that  approximately 
320 000  workers  will  be  needed  in  occupations 
requiring  high-level  education,  alongside  150 000 
workers 
roles  necessitating  medium-level 
qualifications.  Conversely,  occupations  requiring 
low  levels  of  qualification  are  expected  to  shrink 
by 21 000 (see Graph A10.2). 

in 

Graph A12.2: Future employment needs (2022-
2035) by occupation and education level 

Source: CEDEFOP, Skills forecast 2023 – Slovenia. 

The population is only slowly adapting to the 
digital  transition  and  is  lagging  in  digital 
skills.  Slovenia’s  share  of  the  general  population 
(aged  16-74)  with  at  least  basic  digital  skills  is 
considerably  lower  than  the  EU  average  (47%  vs 
56%  in  2023).  Looking  at  different  age  groups, 

(208) CEDEFOP, Skills forecast 2023 – Slovenia. 

-40000-20000020000400006000080000100000120000140000160000180000AssociateprofessionalsClerksElementaryworkersFarm andrelatedworkersManagersOperators andassemblersProfessionalsService andsales workersTradesworkersLowMediumHigh 
 
  
 
only  those  aged  16-24  score  above  the  EU 
average (73% vs 70%). The gap is especially large 
for the unemployed (27.5% vs 46.5% at EU level) 
and  more  generally,  digital  skills  remain  a 
challenge, in particular for older, less educated and 
socially  disadvantaged  people  who  do  not  have 
access  to  digital  tools  or  skills  to  use  them.  This 
underscores  the  need  for  further  strengthening 
upskilling and reskilling. The RRP allocates EUR 71 
million for investments in digital infrastructure and 
skills.  Together  with  measures  financed  by  the 
ESF+, 661 000 people are expected to benefit. 

in 

recruiting 

ICT  specialists, 

The  lack  of  ICT  specialists  is  a  growing 
constraint  on  productivity  and  growth.  In 
2023,  78%  of  Slovenian  enterprises  reported 
(EU 
difficulties 
average: 63%) and the Chamber of Commerce and 
Industry  of  Slovenia  estimates  that  on  top  of  the 
around 1 400 ICT specialists trained every year, an 
additional  3 000-4 000  ICT  specialists  per  year 
would  be  needed  to  reach  the  Digital  Decade 
target.  As  a  result,  the  current  number  of  ICT 
graduates is insufficient to meet the needs of the 
digital  transformation  in  the  corporate  sector  and 
is  increasingly  becoming  a  crucial  challenge.  Yet 
between  2022-2024,  the  share  of  ICT  specialists 
declined  from  4.5%  to  4.3%  and  remains  below 
the EU average of 5%. This might harm the uptake 
of  advanced  technologies,  e.g.  AI,  cloud  and  data 
analytics,  in  businesses,  where  Slovenia  performs 
poorly. The sector is also marked by a pronounced 
gender disparity, with only 17.1% of ICT specialists 
being  women  (EU  average:  19.4%).  Slovenia  is 
taking  action  to  improve  the  situation,  e.g.  via  a 
higher education curricula reform and measures to 
monitor  ICT  specialist  needs  through  a  Skills 
Forecasting  Platform.  The  RRP  has  allocated 
EUR 60 million in funding to pilot projects in higher 
education  to  strengthen  quality  and  integrate 
digital and sustainable skills in curricula. 

the  green 

for 
transition.  These  occupations 
insulation  workers,  civil  engineering 
included 
technicians  and  civil  engineers.  Simultaneously, 
SMEs  highlight  the  need  for  occupation-specific 
skills  and  for  greening  the  economy,  including 
transversal  skills.  Attention  should  be  devoted  to 
specialists  in  green  technologies  and  innovations 
essential for a sustainable transformation. 

reasons, 

rates  among 

(22%).  Among  other 

factors.  The 
the 

The  large  decline  of  participation  in  adult 
learning  warrants  increased  and  targeted 
boost 
policy 
should 
action,  which 
learning 
competitiveness.  Slovenia’s  adult 
participation  (aged  25-64)  rate  declined  sharply 
from  40.3%  in  2016  to  26.5%  in  2022,  moving 
further  away  from  the  2030  national  target  of 
(31.2%)  participated 
60%  by  2030.  Women 
significantly more frequently in training compared 
to  men 
the 
deterioration  was  driven  by  a  combination  of 
socio-economic  and 
systemic,  demographic, 
low 
pandemic-related 
training 
participation 
low-qualified 
continues  to  pose  a  significant  challenge,  notably 
considering widespread labour shortages. At 7.8% 
in  2022 
their  share 
decreased from 2016 and was less than a third of 
the  share  of  the  overall  population,  while  almost 
every second adult with tertiary education (48.1%) 
participated in training. Slovenia is thus unlikely to 
meet the EU benchmark of 30% for adult learning 
participation  among  low-qualified  individuals  by 
2025.  Rates  were higher  for  unemployed  adults  - 
with  23.1%  having  recent  learning  experiences, 
exceeding  the  EU  benchmark  of  20%  -  and  have 
been broadly stable since 2016. Other groups such 
as  older  workers  (55  and  over),  persons  with  a 
migrant  background  and  those  outside  the  labour 
force are particularly in need of up- and reskilling, 
yet their participation is low and decreasing. 

(EU  average:  18.4%), 

Within  the  broader  need  for  upskilling  and 
reskilling,  the development of  green  skills is 
essential for speeding up the transition to a 
net-zero economy. More than 70% of Slovenians 
believe  that  they  have  the  necessary  skills  to 
contribute  to  the  green  transition  (EU  average 
54%) (209). However, in 2022, Slovenia experienced 
labour  shortages  across  66  occupations  that 
demanded  specialised  skills  or  expertise  essential 

(209) Special Eurobarometer 527: Fairness perceptions of the 

green transition. 

89 

aims 

Slovenia 

Slovenia is undertaking significant efforts to 
improve  participation 
in  training  among 
adults  and  foster  lifelong  learning.  Under  its 
ambitious  2022-2030  National  Adult  Education 
Programme, 
increase 
participation  in  lifelong learning  to  66%  by  2030. 
Approximately  EUR 423  million  (67%  of  the  ESF+ 
allocation)  has  been  designated  for  initiatives 
under  the  theme  ‘Skills  and  Responsive  Labour 
Market’, including for the integration of green skills 
within  the  education  system,  also  covering  VET. 
Furthermore,  the  ESF+  is  investing  in  essential 
skills  (EUR 37  million)  and  supporting  flexible 

to 

 
 
opportunities for upskilling and reskilling, including 
digital competencies. 

90 

 
ANNEX 13: SOCIAL SCOREBOARD 

Table A13.1:Social Scoreboard for Slovenia 

(1) Update of 5 May 2025. Members States are categorised based on the Social Scoreboard according to a methodology agreed 
with the EMCO and SPC Committees. Please consult the Annex of the Joint Employment Report 2025 for details on the 
methodology (https://employment-social-affairs.ec.europa.eu/joint-employment-report-2025-0). 
Source: Eurostat 

91 

26.55.046.77.66.03.4278.33.71.1120.714.411.837.714.23.857.83.4Critical situationTo watchWeak but improvingGood but to monitorOn averageAdult participation in learning (during the last 12 months, excl. guided on the job training, % of the population aged 25-64, 2022)Equal opportunities and access to the labour marketBest performersBetter than averageEarly leavers from education and training(% of  the population aged 18-24, 2024)Young people not in employment, education or training(% of the population aged 15-29, 2024)Gender employment gap(percentage points, population aged 20-64, 2024)Income quintile ratio (S80/S20, 2024)Dynamic labour markets and fair working conditionsSocial protection and inclusionShare of individuals who have basic or above basic overall digital skills(% of the population aged 16-74, 2023)Impact of social transfers (other than pensions) on poverty reduction(% reduction of AROP, 2024)Children aged less than 3 years in formal childcare (% of the under 3-years-old population, 2024)Self-reported unmet need for medical care (% of the population aged 16+, 2024)Disability employment gap (percentage points, population aged 20-64, 2024)Housing cost overburden (% of the total population, 2024)At risk of poverty or social exclusion (AROPE) rate (% of the total population, 2024)Employment rate(% of the population aged 20-64, 2024)Unemployment rate(% of the active population aged 15-74, 2024)Long term unemployment(% of the active population aged 15-74, 2024)Gross disposable household income (GDHI) per capita growth(index, 2008=100, 2023)At risk of poverty or social exclusion (AROPE) rate for children(% of the population aged 0-17, 2024) 
 
 
 
  
 
 
ANNEX 14: HEALTH AND HEALTH SYSTEMS 

Slovenia’s  health  system  faces  challenges 
that need to be addressed if the country is to 
improve  the  health  of  its  population  and 
social 
the 
competitiveness  of  its  economy.  The  main 
challenge  is  limited  access  to  healthcare,  mainly 
caused by shortages of healthcare workers.  

fairness,  while 

boosting 

in  Slovenia 
Life  expectancy  at  birth 
rebounded  above  its  pre-COVID-19  level and 
was above the EU average in 2023. As in other 
EU countries, women can expect to live longer than 
men (5.8 years longer). However, unlike in other EU 
countries, they can also expect to live considerably 
longer  in  good  health  (around  3.5  years  longer 
than  men).  Slovenia  fares  comparatively  well  in 
avoiding  deaths  from  treatable  causes.  Diseases 
of 
(‘cardiovascular 
diseases’)  and  cancer  are  the  leading  causes  of 
death,  with  mortality  rates  higher  than  the  EU 
average, particularly for cancer. Suicide rates are a 
cause for concern, remaining among the highest in 
the  EU,  despite  a  decrease  in  recent  years. 
Slovenia  participates  in  EU4Health-funded  joint 
actions  aimed  at 
the  burden  of 
cardiovascular  diseases,  cancer,  diabetes  and 
respiratory diseases, and improving mental health. 

circulatory 

reducing 

system 

the 

Graph A14.1: Life expectancy at birth, years 

Source: Eurostat (demo_mlexpec) 

is  projected 

Health  expenditure in  Slovenia  is lower  than 
the  EU  average,  as  is  the  share  of  health 
costs covered by public funds. However, due to 
population  ageing,  Slovenia 
to 
increase  its  public  healthcare  spending,  raising 
concerns about fiscal sustainability (see Annex 1). 
In  2022,  health  spending per  inhabitant (adjusted 
for  differences  in  purchasing  power)  was  below 
the  EU  average  and  only  74%  of  it  was  publicly 
funded.  The  main  source  of  healthcare  funding  is 
the employment-based statutory health insurance. 
In  2024, 
the 
complementary  voluntary  health  insurance  into  a 

the  government 

transformed 

mandatory  contribution  to  the  statutory  health 
insurance. This change is expected to increase the 
share of publicly funded health expenditure and to 
keep  the  share  of  out-of-pocket  payments  below 
the EU average (12.4% of total health expenditure 
in  2022  vs  an  EU  average  of  14.3%)  (210).  The 
biggest  share  of  out-of-pocket  payments  went 
towards  outpatient  medical  goods,  followed  by 
outpatient care and dental care. Slovenia received 
a  country-specific  recommendation  in  2024  to 
ensure its fiscal sustainability (see Annex 16). The 
largest  share  of  health  expenditure  went  towards 
outpatient  care,  with  a  share  above  the  EU 
average.  This,  together  with  a  relatively  low 
number  of  hospital  beds  (350  per  100 000 
population in 2022, lower than the EU average of 
444)  illustrates  Slovenia’s  focus  on  primary  care, 
which matches the reform trend observed in other 
countries.  

Graph A14.2: Treatable mortality 

Age-standardised death rate (mortality that could be 
avoided through optimal quality healthcare) 
Source: Eurostat (hlth_cd_apr) 

In  line  with  its  recovery  and  resilience  plan  (RRP), 
Slovenia  set  up  an  independent  body  to  monitor 
and control quality in the healthcare system. Other 
RRP 
investments  are  being  directed  towards 
infrastructure  of  public  healthcare 
physical 
institutions,  medical  equipment,  emergency  and 
preventive health services, and the digitalisation of 
healthcare.  In  2022, investments in  health  capital 
formation,  as  a  share  of  total  health  expenditure, 
were among the highest in the EU (211). 

(210) OECD/European Commission (2024), Health at a Glance: 

Europe 2024 - State of Health in the EU Cycle, pp.186-187. 
(211) See Health at a Glance Europe 2018, 2020, 2022 and 2024. 

92 

81.680.680.781.382.081.380.480.180.681.420192020202120222023SloveniaEU77.472.069.866.964.091.389.291.793.389.720182019202020212022per 100 000 populationSloveniaEU 
 
        
        
 
 
 
 
 
Table A14.1:Key health indicators 

*The EU average is weighted for all indicators except for doctors and nurses per 1 000 population, for which the EU simple 
average is used based on 2022 (or latest 2021) data except for Luxembourg (2017). Doctors’ density data refer to practising 
doctors in all countries except Greece, Portugal (licensed to practise) and Slovakia (professionally active). Density of nurses: data 
refer to practising nurses (EU recognised qualification) in most countries except France and Slovakia (professionally active) and 
Greece (hospital only). **‘Available hospital beds’ covers somatic care, not psychiatric care. ***The EU median is used for patents. 
Source: Eurostat database; European Patent Office; ****European Centre for Disease Prevention and Control (ECDC) for 2023. 

high 

relatively 

As  regards  public  health,  the  focus  on 
disease  prevention  is  below  the  EU  average, 
but  efforts  are  being  made  to  address  the 
preventable 
country’s 
mortality.  In  2022,  spending  on  prevention  in 
Slovenia accounted for 4.7% of total  spending on 
health, below the EU average of 5.5%. The rate of 
preventable  mortality  is  higher  than  the  EU 
average,  linked  to  behavioural  risk  factors  - 
notably  poor  diet,  and  high  alcohol  and  tobacco 
consumption.  Obesity  is  also  a  growing  public 
health  concern,  with  over  half  of  adults  being 
overweight or obese, and adolescent obesity rates 
steadily rising over the past  20 years. To address 
this,  the  government  introduced  the  2015-2025 
national  nutrition  and  physical  activity  strategy, 
which aims to combat obesity by improving dietary 
habits and increasing physical activity. Cancer is a 
major  focus  of  Slovenia's  health  efforts.  Since 
2000,  national  strategies  and  programmes  for 
breast,  cervical  and  colorectal  cancer  screening 
have  boosted  early  detection.  By  2021,  screening 
rates for breast and colorectal cancers were higher 
than  the  EU  averages,  though  regional  disparities 
remain  a  challenge.  The  third  national  cancer 
control  programme  aims  to  lower  cancer  rates, 
improve  survival  and  boost  quality  of  life  for 
patients.  Efforts  to  tackle  preventable  mortality 
include  health  promotion  initiatives  and  stepping 
up  primary  care,  especially  for  chronic  illnesses 
and  vulnerable  populations.  The  new  family 
medicine model includes more nursing support for 
screenings  and  managing  chronic  conditions. 
increasingly  focusing  on 
Health  centres  are 
prevention and care coordination.  

Investments  under  the  RRP  are  being  directed 
towards improving emergency care and infectious 

93 

disease  treatment  facilities 
strengthen the resilience of the health system. 

in  an  effort  to 

room 

leaves  considerable 

Timely  access  to  publicly  funded  health 
services 
for 
improvement.  In  2024,  the  proportion  of  the 
Slovenian  population  reporting  unmet  needs  for 
medical  care  was  higher  than  the  EU  average 
(3.4%  vs  2.5%).  The  main  reasons  for  unmet 
for 
needs  are 
care 
specialists, 
physicians and emergency care. Additional funding 
for  short-term  measures,  mainly  to  reinforce 
primary  care  teams,  have  helped  to  scale  up 
several  programmes  to  address  preventable  and 
treatable mortality.  

long  waiting 
elective 

times,  mainly 

surgery, 

primary 

tackles  challenges 

In  September  2024,  Slovenia  approved  a  primary 
healthcare  development  strategy  for  2024–2031, 
highlighting  the  critical  role  of  primary  care.  The 
strategy 
like  an  ageing 
population,  technological  advances,  and  changing 
patient  needs,  focusing  on  strengthening  the 
primary  healthcare  workforce.  Key  goals  include 
equitable  access  to  care,  health  promotion,  and 
empowering 
priorities 
integrated,  high-quality  care,  better 
include 
management,  financial  incentives,  research,  and 
digital transformation.  

communities. 

Further 

improve 
Investments  under  the  RRP  aim  to 
healthcare  accessibility  through  better  emergency 
medical  services  and  faster  response  times. 
Investments  are  also  being  directed  towards 
creating  post-acute  service  centres,  enhancing 
emergency  care,  and  upgrading  vehicles  and 

20192020202120222023EU average* (latest year) Cancer mortality per 100 000 population290.1290.7277.3280.5n.a.234.7 (2022)Mortality due to circulatory diseases per 100 000 population 393.6 377.1 361.2 332.9n.a.336.4 (2022)Current expenditure on health, purchasing power standards, per capita2 2862 4432 6822 927n.a.3 684.6 (2022)Public share of health expenditure, % of current health expenditure 72.8 73.2 73.8 74.0 73.881.3 (2022)Spending on prevention, % of current health expenditure 3.23.25.44.7n.a.5.5 (2022)Available hospital beds per 100 000 population** 378 364 361 350n.a.444 (2022)Doctors per 1 000 population*3.33.33.33.4n.a.4.2 (2022)*Nurses per 1 000 population* 3.8 4.3 4.5 4.9n.a.7.6 (2022)*Mortality at working age (20-64 years), % of total mortality15.513.414.614.113.814.3 (2023)Number of patents (pharma / biotech / medical technology)151184929 (2023)***Total consumption of antibacterials for systemic use,                    daily defined dose per 1 000 inhabitants****13.010.210.212.413.420.0 (2023) 
 
        
 
Slovenia  aims  to  scale  up  the  digitalisation 
of  its  health  system,  with  support  from  EU 
programmes.  The  shares  of  people  accessing 
their  personal  health  records  online  and  using 
online health services (excluding phone) instead of 
in-person  consultations  both  decreased  between 
2022  and  2024. Despite  the  above  average 
overall  technical  deployment  of  electronic  health 
records  (see  Annex  6),  their  use  by  patients  is 
comparatively low.  

digital 

Investments to boost the digital transformation of 
the  health  sector  in  Slovenia  are  planned  under 
both  the  RRP  and  the  cohesion  policy  in  2021-
2027.  The  RRP  investments  focus  on  improving 
to  high-quality  healthcare  data  by 
access 
enhancing 
integrating 
communication 
and 
between 
stakeholders,  and using  real-time  data  for  quality 
monitoring and planning. Key initiatives include: (i) 
expanding the Patient Data Register; (ii) creating a 
central image storage system; (iii) implementing a 
telemedicine platform; (iv) upgrading the eMedical 
appointment system; and (v) boosting digital skills 
in healthcare.  

services, 

patients 

is  currently 

Slovenia 
in  the  final  stages  of 
preparing  a  new  law  that  increases  funding  for 
digital  health  tenfold  over  three  years,  proposes 
that an independent company be set up for digital 
infrastructure,  and  aims  to  standardise  data 
across  national  registries  in  an  effort  to  enhance 
In  addition, 
healthcare  access  and  quality. 
Slovenia  participates  in  joint  actions  and  benefits 
from direct grants under EU4Health to improve the 
interoperability  of  health  data  and 
semantic 
facilitate  the  implementation  of  the  European 
Health Data Space. 

equipment.  Moreover,  Slovenia  participates  in  the 
EU4Health-funded CIRCE Joint Action (212), through 
which  EU  countries  share  good  practices  and 
expertise in primary care.  

Shortages  of  health  staff  in  Slovenia  limit 
the  availability  of  care.  The  number  of  nurses 
per inhabitant in Slovenia is below the EU average 
(4.9 per 1 000 population in 2022 vs 7.6), as is the 
number  of  doctors  (3.4  per  1 000 population  in 
2022  vs  4.2(213)  (see  Annexes  10  and  11). 
Shortfalls  in  primary  care  doctors  and  hospital 
nurses in Slovenia are linked to the low appeal of 
these  careers  including  low  pay.  The  National 
Strategy for the Management and Development of 
Human  Resources  in  Healthcare  2025–2035  is 
being developed.  

Investments under the RRP focus on improving the 
skills of health personnel, enabling nurses to work 
independently  and  expanding  doctors’ 
more 
competencies in primary care. These efforts should 
reduce  the  workloads  of  family  doctors  and 
improve  access  to  primary  care  and  treatment 
conditions.  Moreover,  Slovenia  participates  in  the 
(214), 
EU4Health-funded  HEROES  Joint  Action 
through  which  EU  countries  share  best  practices 
and expertise on health workforce planning. 

innovation  and 

The  potential  of  Slovenia’s  health system  to 
drive 
industrial 
foster 
in  the  EU  medical  sector 
development 
remains  largely  untapped.  Slovenia  is  among 
the  EU  countries  that  report  the  lowest  levels  of 
public 
research  and 
development.  This  is  reflected  in  the  low  number 
of  European  patents  granted:  nine  in  2023  in  the 
combined 
pharmaceuticals, 
biotechnologies  and  medical  devices,  against  an 
EU-level median of 29 (215). Clinical trial activity is 
also limited in Slovenia (216).  

spending  on  health 

areas 

of 

(212) https://circeja.nfz.gov.pl/ 

(213) According to the newly-adopted Eurostat definition of nurses 

(set out in Directive 2005/36/EC on the recognition of 
professional qualifications) nurse density numbers are 
significantly lower (491) than numbers using a broader 
definition, for instance that used for OECD health statistics (1 
043)  

(214) JA HEROES | Health workforce planning project 

(https://healthworkforce.eu/the-project/). 

(215) European Patent Office, Data to download | epo.org.  
(216) EMA (2024), Monitoring the European clinical trials 

environment, p. 9. 

94 

 
 
 
 
 
HORIZONTAL 
ANNEX 15: SUSTAINABLE DEVELOPMENT GOALS 

social 

fairness 

This  Annex  assesses  Slovenia’s  progress  on 
the  Sustainable  Development  Goals  (SDGs) 
along  the  dimensions  of  competitiveness, 
and 
sustainability, 
macroeconomic stability. The 17 SDGs and their 
related  indicators  provide  a  policy  framework 
under  the  UN’s  2030  Agenda  for  Sustainable 
Development.  The  aim  is  to  end  all  forms  of 
inequalities  and  tackle  climate 
poverty,  fight 
change  and 
the  environmental  crisis,  while 
ensuring that no one is left behind. The EU and its 
Member  States  are  committed  to  this  historic 
global  framework  agreement  and  to  playing  an 
active  role  in  maximising  progress  on  the  SDGs. 
The graph below is based on the EU SDG indicator 
set developed to monitor progress on the SDGs in 
the EU. 

Slovenia performs well on most SDGs related 
to  competitiveness  (SDGs  4,  8,  9)  but  still 
needs  to  catch  up  with  the  EU  average  for 
SDG 9.  Slovenia  has  made  progress  on  R&D  and 
(SDG  9),  namely  gross  domestic 
innovation 

Graph A15.1: Progress towards the SDGs in Slovenia 

internet 

connection.  The 

expenditure on R&D has increased from 1.96% of 
GDP in 2018 to 2.13% in 2023 but remains below 
the  EU  average  of  2.22%.  Slovenia  has  made 
significant  progress  on  sustainable  infrastructure 
(SDG 9) regarding the share of households with a 
high-speed 
share 
increased from 63.8% in 2019 to 78.5% in 2023. 
Although  Slovenia  performs  well  on  the 
quality of education (SDG 4), there are signs 
that  it  is  diverging  from  certain  targets, 
particularly due to recent negative trends in 
basic  skills,  including  digital  skills.  On  digital 
skills, the share of adults with at least basic digital 
skills is below the EU average (46.7% in 2023; EU 
average:  55.6%)  and  Slovenia  needs  to  catch  up. 
The  percentage  of  the  population  aged  25  to  34 
completing 
improved, 
tertiary  education  has 
increasing from 40.7% in 2023 to 43.1% in 2024, 
but  remains  slightly  below  the  EU  average  of 
44.2%.  The Slovenian recovery and resilience plan 
(RRP)  will  help  digitalise  the  country’s  public  and 
private  sector  and  boost  digital  skills.  The 
measures  under  the  RRP  will  ensure  that  further 

For detailed datasets on the various SDGs, see the annual Eurostat report ‘Sustainable development in the European Union’; for 
details on extensive country-specific data on the short-term progress of Member States: Key findings – Sustainable development 
indicators - Eurostat (europa.eu). A high status does not mean that a country is close to reaching a specific SDG, but signals that it 
is doing better than the EU on average. The progress score is an absolute measure based on the indicator trends over the past 
five years. The calculation does not take into account any target values, as most EU policy targets are only valid for the aggregate 
EU level. Depending on data availability for each goal, not all 17 SDGs are shown for each country. 
Source: Eurostat, latest update of 28 April 2025. Data refer mainly to the period 2018-2023 or 2019-2024. Data on SDGs may 
vary across the report and its annexes due to different cut-off dates. 

95 

SDG 1SDG 2SDG 3SDG 4SDG 5SDG 6SDG 7SDG 8SDG 9SDG 10SDG 11SDG 12SDG 13SDG 14SDG 15SDG 16SDG 17-100%-75%-50%-25%0%25%50%75%100%-5-4-3-2-1012345Status compared to EU averageProgress scoreSlovenia is progressing towards these SDGs and status is better than EUSlovenia is moving away from these SDGs and status is worse than EUSlovenia is progressing towards these SDGs but status is worse than EUSlovenia is moving away from these SDGs but status is better than EU1. No poverty2. Zero hunger3. Good health and well-being4. Quality education5. Gender equality6. Clean water and sanitation7. Affordable and clean energy8. Decent work and economicgrowth9. Industry, innovation and infrastructure10. Reduced inequalities11. Sustainable cities and communities12. Responsible consumption and production13. Climate action14. Life below water15. Life on land16. Peace, justice and strong institutions17. Partnerships for the goals 
 
 
 
 
 
   
 
progress  is  made  on  these  SDGs  by  helping  to 
digitalise  the  country’s  public  and  private  sector 
and boost digital skills.  

is  expected  to  boost 

Slovenia  is  improving  on  most  of  the  SDGs 
related  to  sustainability  (SDGs  2,  7,  9,  11, 
13), but it is moving away from some (6, 12, 
15)  and  needs  to  catch  up  with  the  EU 
average on four of them (SDGs 2, 9, 12, 13). 
Slovenia  has  made  some  progress  in  increasing 
the  share  of  renewable  energy  in  gross  final 
energy consumption, going from 21.4% in 2018 to 
25.1%  in  2023  (SDG  7).  Moreover,  its  energy 
import  dependency  has  slightly  decreased,  going 
from  51.1%  in  2018  to  49.3%  in  2023.  Through 
the  RRP,  Slovenia 
its 
production of renewable energy by investing in the 
distribution  grid,  which  would  lower  wholesale 
electricity  prices  and  strengthen  the  case  for 
electrification  across  sectors.  Slovenia  has  made 
some progress on climate action (SDG 13) over the 
last  few  years,  reducing  its  net  greenhouse  gas 
emissions  from  8.9  tonnes  per  capita  in  2018  to 
7.3 in 2022 but it still needs to catch up with the 
EU  average  on  some  aspects.  In  particular,  the 
average  CO2  emissions  per  kilometre  from  new 
passenger  cars  was  123.6  grammes  in  2023, 
while the EU average was 107.6 grammes. Despite 
improvements  on 
innovation  and 
infrastructure (SDG 9), Slovenia still needs to catch 
up  with  the  EU  average  on  certain  indicators.  In 
particular,  the  share  of  buses  and  trains  in 
passenger  transport  is  very  low  (13.9%  in  2022, 
compared to EU average of 16.6%). Slovenia’s RRP 
contains several measures aimed at increasing the 
use of public transport and significantly improving 
the country’s railway infrastructure, which will help 
the country tackle this challenge.  

industry, 

Slovenia  has  been  moving  away  from 
responsible  consumption  and  production 
(SDG  12)  and  needs to catch  up with  the  EU 
average  (See  Annex  7).  Particularly  noteworthy 
is the increase in generation of waste from 3,964 
kg  per  capita  in  2018  to  5,397  kg  in  2022. 
Moreover,  the  rate  of  circular  material  input  for 
domestic  use  decreased  from  1.6%  to  1.3%,  well 
below  the  EU  average  of  2.5%.  Although  it 
remains above the EU average on clean water and 
sanitation  (SDG  6)  and  on  life  on  land  (SDG  15), 
Slovenia  has  also  been  moving  away  from  these 
SDGs. The performance for all indicators on water 
quality has decreased, in particular the percentage 
of inland bathing waters with excellent quality has 
gone from 76.9% in 2018 to 65.4% in 2023. 

96 

Slovenia  performs  well  or  is  improving  on 
some  SDGs  related  to  social  fairness  (SDGs 
1,  3,  7,  8,  10),  but  there  are  signs  that 
Slovenia is diverging from certain targets for 
quality education (SDG 4) and needs to catch 
up  with  the  EU  average  on  gender  equality 
(SDG  5).  Slovenia  performs  well  on  poverty  and 
basic needs (SDG 1). While the share of people at 
risk  of  poverty  or  social  exclusion  has  increased 
from 13.7% in 2023 to 14.4% in 2024, the share 
remains significantly lower than the EU average of 
21%.  Slovenia  has  improved  on  the  fairness-
related  gender  equality  indicators  (SDG 5),  but  it 
remains below the EU average, particularly on the 
percentage  of  positions  held  by  women  in  senior 
management  which  was  24.7%  in  2024  against 
32.6% for the EU average.  

The quality of education (SDG 4) is above the 
EU  average,  however,  there  is  room  for 
improvement.  The  percentage  of  the  population 
aged  25  to  34  completing  tertiary  education 
reached  43.1%  in  2024,  close  to  the  EU  average 
of  44.2%.  According  to  the  PISA  2022  survey, 
about  a  quarter  of  Slovenian  students  lack  the 
minimum  level  of proficiency  in  mathematics  and 
reading. While this performance is better than the 
EU  average,  Slovenia’s  performance  in  the  PISA 
survey  categories  has  decreased.  The  percentage 
of  early  leavers  from  education  and  training 
decreased from 5.4% in 2023 to 5.0 in 2024, well 
below the EU average of 9.3%, but remains higher 
than the 4.0% of 2022.  

Slovenia  performs  well  on  SDGs  related  to 
macroeconomic  stability  (SDGs  8,  16)  and, 
although it is improving, it needs to catch up 
with  EU  average  on  ‘partnerships  for  goals’ 
(SDG  17).  Slovenia  performs  well  on  indicators 
measuring  employment 
(SDG 8).  Notably,  the 
percentage  of  young  people  not  in  employment, 
education  or  training  is  low  compared  to  the  EU 
average  (7.6%  in  2024;  EU  average:  11.0%).  The 
long-term unemployment rate is also below the EU 
average (1.1% in 2024; EU average: 1.9%).  

(Peace, 

justice  and  strong 
On  SDG 16 
institutions),  the  perceived  independence  of 
the justice system in Slovenia increased from 
39%  in  2019  to  45%  in  2024,  but  remains 
below the EU average of 52%. Conversely, the 
percentage  of  the  population  reporting  crime, 
violence or vandalism in their area decreased from 
7.3 in 2020 to 6.8 in 2023, a better performance 

 
for  example, 

(SDG 17),  Slovenia 

than  the  EU  average  which  stands  at  10.0.  On 
is 
‘Partnership  for  goals’ 
improving,  with, 
the  general 
government gross debt going from 68.4% of GDP 
in  2023  to  67.0%  in  2024.  However,  its  official 
development assistance is only at 0.29% of GNI in 
2023,  significantly  below  the  EU  average  of 
0.56%.  

As the SDGs form an overarching framework, any 
links  to  relevant  SDGs  are  either  explained  or 
depicted with icons in the other annexes. 

97 

 
ANNEX 16: CSR PROGRESS AND EU FUNDS IMPLEMENTATION 

policy  programmes  has  accelerated,  although 
significant  volumes  of  investment  are  yet  to  be 
mobilised.  

The  Slovenian  RRP  contains  50  investments 
and  36  reforms  to  stimulate  sustainable 
growth  and  foster  the  digital  transition.  A 
year  before  the  end  of  the  RRF  timespan, 
implementation  is  well  on  its  way,  with  40.9%  of 
the  funds  disbursed.  At  present,  Slovenia  has 
fulfilled  32%  of  the  milestones  and  targets  in  its 
RRP (221). Efforts are needed to ensure completion 
of  all  RRP  measures  by  31 August  2026.  The 
implementation 
faces 
challenges.  Investments  are  highly  concentrated 
towards  the  end  of  the  implementation  period, 
which can create significant capacity challenges at 
various 
therefore  merit  special 
attention.  

levels  and 

Slovenia’s 

RRP 

of 

the 

Slovenia  also  receives  funding  from  several 
other  EU  instruments,  including  those  listed  in 
Table  A16.1.  Most  notably, 
common 
agricultural policy (CAP) provides Slovenia with an 
EU  contribution  of  EUR 1.2  billion  under  the  CAP 
(222).  Operations 
strategic  plan  2023-2027 
amounting  to  EUR  97  million  (223)  have  been 
signed  under  the  InvestEU  instrument  backed  by 
the  EU  guarantee,  improving  access  to  financing 
for riskier operations in Slovenia. 

Slovenia  faces  structural  challenges  in  a 
wide  range  of  policy  areas,  as  identified  in 
the country-specific recommendations (CSRs) 
addressed  to  the  country  as  part  of  the 
European  Semester.    They  refer,  among  other 
things,  to  skills  and  education,  tax  administration, 
healthcare,  renewable  energy  and  infrastructure, 
transport and the labour market. 

The Commission has assessed the 2019-2024 
CSRs  considering  the  policy  action  taken  by 
Slovenia to date and the commitments in its 
recovery  and  resilience  plan  (RRP).  At  this 
stage, Slovenia has made at least ‘some progress’ 
on 82% of the CSRs (217), and ‘limited progress’ on 
18% (Table A16.2). 

by 

to  Slovenia 

competitiveness, 

EU funding instruments provide considerable 
resources 
supporting 
investments  and  structural  reforms  to 
increase 
environmental 
sustainability  and  social  fairness,  while 
helping  to  address  challenges  identified  in 
the  CSRs.  In  addition  to  the  EUR 2.7  billion 
funding  from  the  Recovery  and  Resilience  Facility 
(RRF) in 2021-2026, EU cohesion policy funds (218) 
are  providing  EUR 3.2  billion 
to  Slovenia 
(amounting  to  EUR 4.5  billion  with  national  co-
financing)  for  2021-2027  (219)  to  boost  regional 
competitiveness  and  growth.  Support  from  these 
instruments  combined  represents  around  9.3%  of 
these 
2024  GDP 
instruments  to  different  policy  objectives 
is 
outlined 
in  Graphs  A16.1  and  A16.2.  This 
substantial  support  comes  on  top  of  financing 
the  2014-2020 
provided 
multiannual  financial  framework,  which  financed 
projects  until  2023  and  has  had  significant 
benefits  for  the  economy  and  Slovenian  society. 
Project  selection  under  the  2021-2027  cohesion 

(220).  The  contribution  of 

to  Slovenia  under 

(217) 17% of the 2019-2024 CSRs have been fully implemented, 
18% substantially implemented, and some progress has 
been made on 47%. 

(218) In 2021-2027, cohesion policy funds include the European 
Regional Development Fund, the Cohesion Fund, the 
European Social Fund Plus and the Just Transition Fund. The 
information on cohesion policy included in this annex is 
based on adopted programmes with the cut-off date of 5 
May 2025. 

(219) European territorial cooperation (ETC) programmes are 

excluded from the figure. 

(220) RRF funding includes both grants and loans, where 

(221) As of mid-May 2025, Slovenia has submitted 3 payment 

requests. 

(222) An overview of Slovenia’s formally approved strategy to 

implement the EU’s common agricultural policy nationally 
can be found at: https://agriculture.ec.europa.eu/cap-my-
country/cap-strategic-plans/slovenia_en.  

applicable. GDP figures are based on Eurostat data for 2024. 

(223) Data reflect the situation on 31.12.2024. 

98 

 
 
 
 
 
 
Graph A16.1: Distribution of RRF funding in 
Slovenia by policy field 

(1) Each RRP measure helps achieve the aims of two of the 
six policy pillars of the RRF. The primary contribution is shown 
in the outer circle, while the secondary contribution is shown 
in the inner circle. Each circle represents 100% of the RRF 
funds. Therefore, the total contribution to all pillars displayed 
on this chart amounts to 200% of the RRF funds allocated. 
Source: European Commission 

Graph A16.2: Distribution of cohesion policy 
funding across policy objectives in Slovenia 

Source: European Commission 

and 

competitiveness 

Cohesion  policy  funds  aim  to  increase  the 
productivity 
of 
Slovenian  firms  and  improve  the  business 
the  European 
environment.  For  example, 
Regional  Development  Fund  (ERDF),  the  Cohesion 
Fund  and  the  Just  Transition  Fund  (JTF)  are 
providing  support  to  almost  11 900  businesses 
and  are  enabling  400  small  and  medium-sized 
enterprises  (SMEs)  to  invest  in  new  skills  relevant 
for  smart  specialisation,  industrial  transition  and 
the 
entrepreneurship. Investments 
upgrade  of  the  Vega  supercomputer  at  the 
University  of  Maribor  in  the  north-east  of  the 
country  and  the  National  Institute  of  Biology  in 
Ljubljana  help  boost  research  and  innovation 
further  in  Slovenia,  creating  positive  spillovers  to 
business  and 
In  addition, 
tech-businesses. 
EUR 406  million  from  the  European  Social  Fund 
Plus  (ESF+)  are  going  towards  supporting  the 

such 

as 

development  of  skills,  including  for  upskilling  and 
adult  education  to  better  align  skills  with  the 
labour market, to bring vulnerable groups into the 
labour  market  and  to  provide  better  skills  for  the 
digital  and  green  transition.  The  ESF+  funding  is 
also bolstering development of the social economy 
and  social  innovations.  The  educational  system, 
including  vocational  education  and  training,  is 
being  further  aligned  with  labour  market  needs, 
emphasising  key  competencies  and  digital  skills. 
Over  62 300  young  people  between  the  ages  of 
18  and  29  will  benefit  from  market  relevance 
education and training system. 

for 

are 

funds 

contributing 

Other 
to 
competitiveness  in  Slovenia,  for  instance 
through  open  calls.  The  Connecting  Europe 
Facility  has  financed  strategic  investments  for 
instance  in  the  development  of  the  rail  transport 
infrastructure;  key  infrastructure  projects  that 
integration, 
energy  market 
allow 
decarbonisation of the energy system and security 
of  energy  supply;  and  to  building  a  robust,  and 
secure, state of the art  connectivity infrastructure 
by  funding  projects  such  as  smart  emergency 
response  and 
recovery. Horizon  Europe  has 
supported research and innovation, from scientific 
breakthroughs  to  scaling  up  innovations,  with 
Climate,  Energy  and  Mobility  and  Digital,  Industry 
and  Space  as  top  priorities  in  Slovenia.  In  2024, 
the  Technical  Support  Instrument  (TSI)  supported 
Slovenia in reviewing and upgrading methods and 
processes  for  quarterly  GDP  calculation  and 
macroeconomic 
It  also  helped 
forecasting. 
Slovenia  reinforcing  the  level  of  financial  literacy 
including  through  the 
of  citizens  and  SMEs, 
development of a survey and educational tools. 

to 

the 

Slovenia’s  RRP  also  contains  ambitious 
business 
improve 
measures 
environment  and  competitiveness.  As  part  of 
the  measures  covered  by  payment  requests 
submitted  over  the  past  year,  grants  were 
increasing 
to  projects  aimed  at 
awarded 
investment  and  fostering  the  competitiveness  of 
the  business  environment,  alongside  a  reform  of 
the  public  procurement  system  and  reforms  to 
spatial  planning 
simplify 
procedures. 

construction  and 

EU  funds  are  playing  a  significant  role  in 
and 
green 
the 
promoting 
environmental  sustainability 
in  Slovenia 
during  the  current  seven-year  EU  budget 
(multiannual  financial  framework).  Cohesion 

transition 

99 

Green transitionDigital transformationSmart, sustainable andinclusive growthSocial & territorial cohesionHealth & resilienceNext generationSmarter EuropeGreener EuropeConnected EuropeSocial EuropeEurope closer to citizensJTF specific objective 
    
 
   
to 

capacity 

renewable 

policy  funding  to  the  green  transition  in  Slovenia 
amounts  to  over  EUR 1  billion.  The  funding  is 
making  a  substantial  contribution  to  improving 
energy efficiency and promoting renewable energy 
and  smart  energy  systems,  with  additional 
for 
production 
energy 
amounting 
Flood-protection 
614 MW. 
installations  are  at  the  core  of  climate  mitigation 
measures,  with  a  focus  on  sustainable  nature-
based  solutions  across  all  major 
riverbeds. 
Meanwhile, the Just Transition Fund is helping the 
district  heating system in the Šaleška Valley  shift 
from  coal  dependency  to  renewable  energy 
sources,  aiming  to  achieve  a  100%  sustainable 
heat supply for the region’s 35 000 residents and 
industry.  Slovenia’s  CAP  strategic  plan 
local 
allocates 58% (almost EUR 320 million) of its rural 
development  budget  and,  through  eco-schemes, 
15%  (EUR  101  million)  of  its  direct  payments 
budget  to  environmental  and  climate  objectives. 
Slovenia  has  also  reserved  EUR 12.1  million  per 
year  for  the  preservation  of  biodiversity.  This 
means  a  six-fold  increase  in  CAP  funds  for 
previous 
biodiversity 
programming period of 2014-2022. 

compared 

the 

to 

include: 

last  year 

Slovenia’s RRP contains several reforms and 
investments  related  to  fairness  and  social 
policies.  Measures  covered  by  the  payment 
(i)  the 
request  submitted 
granting  of  awards  for  the  construction  of  new 
institutional  care  facilities  to  provide  appropriate 
housing  to  address  the  expected  increase  in 
demand  for  institutional  care  due  to  an  ageing 
society; (ii) investments to reform the educational 
system  and  invest  in  digital  and  green  skills  to 
boost  knowledge  and  strengthen  the 
labour 
market;  and  (iii)  launching  the  reform  of  the 
pension  system  to  prepare  the  labour  market  for 
negative  demographic 
trends.  The  TSI  has 
enhanced Slovenia’s capacity to perform strategic 
planning for balanced regional development and a 
just transition, as well as supporting authorities in 
the  health  sector 
implement  EU  Health 
Technology Assessment Regulation and to improve 
cancer screening programmes.  

to 

Slovenia’s  RRP,  including  the  REPowerEU 
chapter, has a comprehensive set of reforms 
and  investments  for  the  green  transition. 
Measures  covered  by 
request 
submitted last year include: (i) the entry into force 
of  an  act  on  alternative  fuels  in  transport;  (ii) 
completing the selection of investment projects in 
greening  education  infrastructure;  and  (iii)  the 
entry into force of a ban on the use of fossil fuels 
for heating in new buildings. 

the  payment 

Promoting  fairness,  social  cohesion  and 
improving  access  to  basic  services  are 
among  the  key  priorities  of  EU  funding  in 
Slovenia. For instance, ERDF funding is being put 
towards  increasing  the  capacity  of  healthcare 
facilities for 123 000 people/year. In addition, the 
ESF+  is  providing  EUR 94  million  to  fight  poverty 
through  the  development  of  social  competencies 
and  new  skills.  This  includes  measures  for  the 
social  inclusion  of  people  with  special  needs  and 
vulnerable groups. Nearly 11 000 unemployed and 
inactive  people  will  benefit  from  these  measures. 
Meanwhile,  measures  are  being  supported  to 
integrate  immigrants  into  the  education  system 
through  language  learning  for  children  and  their 
parents. 

100 

 
 
 
Table A16.1:Selected EU funds with adopted allocations - summary data (million EUR) 

(1) The cut-off date for data on disbursements under the RRF is 31 May 2025. 
(2) Cohesion policy 2014-2020 allocations include REACT-EU appropriations committed in 2021-2022. 
(3) These amounts relate only to disbursements made from 2021 onwards and do not include payments made to the Member 
State before 2021.  Hence the figures do not comprise the totality of payments corresponding to the 2014-2020 allocation. The 
cut-off date for data on disbursements under EMFAF and EMFF is 29 April 2025.  The cut-off date for data on disbursements 
under cohesion policy funds, AMIF, BMVI and ISF is 5 May 2025. 
(4) AMIF - Asylum, Migration and Integration Fund; BMVI - Border Management and Visa Instrument; ISF - Internal Security Fund. 
(5) Expenditure outside the CAP strategic plan is not included. 
(6) The cut-off date for data on EAFRD disbursements is 5 May 2025. The information on EAGF disbursements is based on the 
Member State declarations until March 2025.  Disbursements for the Direct Payments (EAGF) started in 2024. 
Source: European Commission 

101 

Instrument/policyDisbursed since 2021   (1)             RRF grants (including the RepowerEU allocation)672.5RRF loans426.2 Instrument/policyAllocation 2014-2020 (2)Allocation 2021-2027 Disbursed since 2021 (3)    (covering total payments to the Member State on commitments originating from both 2014-2020 and 2021-2027 programming periods) Cohesion policy (total)3 336.93 242.11 851.4European Regional Development Fund (ERDF)1 672.41 599.8 985.2Cohesion Fund (CF) 914.0 718.2 435.9European Social Fund (ESF, ESF+) and the Youth Employment Initiative (YEI) 750.4 665.4 349.1Just Transition Fund (JTF) 258.7 81.2European Maritime, Fisheries and Aquaculture Fund (EMFAF) and the European Maritime and Fisheries Fund (EMFF) 21.8 23.916.9Migration, border management and internal security - AMIF, BMVI and ISF (4) 79.1 185.366.0The common agricultural policy under the CAP strategic plan (5)Disbursements under the CAP Strategic Plan (6)Total under the CAP strategic plan309.5European Agricultural Guarantee Fund (EAGF)231.7European Fund for Agricultural Development (EAFRD)77.8Allocation 2023-20271 225.8 680.7 545.1Allocation 2021-2026 1 612.91 072.4FisheriesMigration and home affairs 
 
 
      
 
Table A16.2:Summary table on 2019-2024 CSRs 

(Continued on the next page) 

102 

SloveniaAssessment in May 2025Relevant SDGs2019 CSR 1Some progressAchieve the medium-term budgetary objective in 2020.No longer relevantSDG 8, 16Adopt and implement reforms in healthcareSome progressSDG 3and long-term care that ensure quality, accessibility and long-term fiscal sustainability.Substantial progress SDG 3Ensurethelong-termsustainabilityandadequacyofthepensionsystem, including by adjusting the statutory retirement age restricting early retirement and other forms of early exit from the labour market.Substantial progress SDG 8Increasetheemployabilityoflow-skilledandolderworkersbyimprovinglabourmarketrelevanceofeducationandtraining,lifelonglearningandactivationmeasures,includingthroughbetterdigitalliteracy.Some progressSDG 4, 82019 CSR 2Some progressSupport the development of equity markets.Some progressSDG 8, 9Improve the business environment by reducing regulatory restrictions and administrative burden.Some progressSDG 8, 9Improve competition, professionalisation and independent oversight in public procurement.Some progressSDG 9Carry out privatisations in line with the existing plans.Substantial progress SDG 92019 CSR 3Some progressFocus investment-related economic policy on research and innovation,Some progressSDG 9, 10, 11low carbon and energy transition,Some progressSDG 7, 9, 10, 11, 13sustainable transport, in particular rail, and Some progressSDG 10, 11environmental infrastructure, taking into account regional disparities.Some progressSDG 6, 10, 11, 12, 152020 CSR 1Some progressTakeallnecessarymeasures,inlinewiththegeneralescapeclauseoftheStabilityandGrowthPact,toeffectivelyaddresstheCOVID-19pandemic,sustaintheeconomyandsupporttheensuingrecovery.Wheneconomicconditionsallow,pursuefiscalpoliciesaimedatachievingprudentmedium-termfiscalpositionsandensuring debt sustainability, while enhancing investment. No longer relevantSDG 8, 16Ensuretheresilienceofthehealthandlong-termcaresystem,includingbyprovidingtheadequatesupplyofcriticalmedicalprod-ucts and addressing the shortage of health workers.Some progressSDG 32020 CSR 2Substantial progressMitigate the social and employment impact of the COVID-19 crisis, including by providing adequate income replacement and social protection, Full Implementation SDG 1, 2, 8, 10enhancing short-time work schemes and through flexible working arrangements. Substantial progressSDG 8Ensure that these measures provide adequate protection for non-standard workers.Full Implementation SDG 1, 2, 8, 102020 CSR 3Some progressContinue to swiftly implement measures to provide liquidity and financing to businesses and households and Full implementationSDG 8, 9reduce administrative burden. Some progressSDG 8, 9Front-load mature public investment projects and Substantial progressSDG 8, 16promote private investment to support the economic recovery. Some progressSDG 8, 9Focusinvestmentonthegreenanddigitaltransition,inparticularonclean and efficient production and use of energy, Some progressSDG 7, 9, 13environmental infrastructure,Some progressSDG 6, 12, 15sustainable transport,Some progressSDG 11research and innovation, and Some progressSDG 9the rollout of the 5G network. Some progressSDG 9Promote digital capacities of businesses, andSome progressSDG 9 
 
 
  
 
Table (continued) 

(Continued on the next page) 

103 

strengthen digital skills, Some progressSDG 4e-commerce and Limited progressSDG 9e-health.Limited progressSDG 32021 CSR 1No longer relevantIn2022,maintainasupportivefiscalstance,includingtheimpulseprovidedbytheRecoveryandResilienceFacility,andpreservenationally financed investment.No longer relevantSDG 8, 16Wheneconomicconditionsallow,pursueafiscalpolicyaimedatachievingprudentmedium-termfiscalpositionsandensuringfiscalsustainability in the medium term. No longer relevantSDG 8, 16At the same time, enhance investment to boost growth potential.Payparticularattentiontothecompositionofpublicfinances,onboththerevenueandexpendituresidesofthebudget,andtothequalityofbudgetarymeasuresinordertoensureasustainableandinclusiverecovery.Prioritisesustainableandgrowth-enhancinginvestment,inparticularinvestmentsupportingthegreenanddigitaltransition. No longer relevantSDG 8, 16Giveprioritytofiscalstructuralreformsthatwillhelpprovidefinancingforpublicpolicyprioritiesandcontributetothelong-termsustainabilityofpublicfinances,including,whererelevant,bystrengtheningthecoverage,adequacy,andsustainabilityofhealthand social protection systems for all.No longer relevantSDG 8, 162022 CSR 1Some progressIn2023,ensurethatthegrowthofnationally-financedcurrentexpenditureisinlinewithanoverallneutralpolicystance,takingintoaccountcontinuedtemporaryandtargetedsupporttohouseholdsandfirmsmostvulnerabletoenergypricehikesandtopeoplefleeingUkraine.Standreadytoadjustcurrentspendingtotheevolving situation.No longer relevantSDG 8, 16Expandpublicinvestmentforthegreenanddigitaltransitionandforenergysecurity,includingbymakinguseoftheRRF,RePowerEUand other EU funds.Substantial progress SDG 8, 16Fortheperiodbeyond2023,pursueafiscalpolicyaimedatachieving prudent medium-term fiscal positions.Full Implementation SDG 8, 16Ensure the long-term fiscal sustainability of the healthcare andLimited progress SDG 3long-term care systems.Substantial progress SDG 3Introducecompensatingmeasurestofinalisetheshiftfromlabourtaxes,includingbyrebalancingtowardsmoregreenandgrowth-friendly taxes.Full Implementation SDG 8, 10, 122022 CSR 2Proceedwiththeimplementationofitsrecoveryandresilienceplan,inlinewiththemilestonesandtargetsincludedintheCouncilImplementing Decision of 28 July 2021.Submitthe2021-2027cohesionpolicyprogrammingdocumentswithaviewtofinalisingtheirnegotiationswiththeCommissionandsubsequently starting their implementation.2022 CSR 3Some progressDiversifyimportsoffossilfuelsandreduceoverallrelianceonfossilfuelsSome progressSDG 7, 9, 13byacceleratingthedeploymentofrenewables,inparticularbyfurther streamlining permitting procedures,Some progressSDG 7, 8, 9, 13and strengthening of the electricity distribution network.Limited progressSDG 7, 9, 13Increaseimplementationofenergyefficiencymeasures,notablyinthe building sector,Some progressSDG 7electrification of the transport sector,Limited progress SDG 11andbyensuringthatenergyinfrastructureandinterconnectionshave sufficient capacity.Substancial progress SDG 7, 9, 132023 CSR 1Substantial progress Winddowntheenergysupportmeasuresinforcebytheendof2023usingtherelatedsavingstoreducethegovernmentdeficit.Shouldrenewedenergypriceincreasesnecessitatesupportmeasures,ensurethatthesearetargetedatprotectingvulnerablehouseholdsandfirms,fiscallyaffordable,andpreserveincentivesforenergysavings.Substantial progress SDG 8, 16Ensureprudentfiscalpolicy,inparticularbylimitingthenominalincreaseinnationallyfinancednetprimaryexpenditurein2024tonot more than 5.5%.Full Implementation SDG 8, 16PreservenationallyfinancedpublicinvestmentandensuretheeffectiveabsorptionofRRFgrantsandotherEUfunds,inparticularto foster the green and digital transitions.Full Implementation SDG 8, 16RRP implementation is monitored by assessing RRP payment requests and analysing reports published twice a year on the achievement of the milestones and targets. These are to be reflected in the country reports. Progress on the cohesion policy programming documents is monitored under the EU cohesion policy. 
 
 
  
 
Table (continued) 

Source: European Commission 

104 

Fortheperiodbeyond2024,continuetopursueamedium-termfiscalstrategyofgradualandsustainableconsolidation,combinedwithinvestmentsandreformsconducivetohighersustainablegrowth, to achieve a prudent medium-term fiscal position.Full Implementation SDG 8, 16Ensure the long-term fiscal sustainability of the healthcare andLimited progressSDG 3long-term care systemsSubstantial progress SDG 3Rebalancetaxrevenuestowardsmoregrowth-friendlyandsustainable sources.Limited progressSDG 8, 10, 122023 CSR 2  Ensure an effective governance structure and strengthen theadministrativecapacitytoallowforaswiftandsteadyimplementationofitsrecoveryandresilienceplan.SwiftlyfinalisetheREPowerEUchapterwithaviewtorapidlystartingitsimplementation.Proceedwiththespeedyimplementationofcohesionpolicyprogrammes,inclosecomplementarityandsynergywith the recovery and resilience plan.2023 CSR 3Some progressContinueeffortstodiversifygasimportsandreduceoverallrelianceon fossil fuelSome progressSDG 7, 9, 13byacceleratingthedeploymentofrenewables,inparticularbyfurther simplifying and shortening the permitting procedures, andSome progressSDG 7, 8, 9, 13strengtheningtheelectricitygrid,aswellasimprovingitsmanagement, including through digitalisation.Limited progressSDG 7, 9, 13Increasetheimplementationofenergyefficiencymeasures,inparticular in the building sector,Some progressSDG 7promote the electrification of the transport sector, andLimited progress SDG 11stepuppolicyeffortsaimedattheprovisionandacquisitionofskillsand competences needed for the green transitionLimited progressSDG 42024 CSR 1Substantial progress Submit the medium-term fiscal-structural plan in a timely manner.Full Implementation SDG 8, 16In line with the requirements of the reformed Stability and Growth Pact, limit the growth in net expenditure in 2025 to a rate consistent with inter alia, putting the general government debt on a plausibly downward trajectory over the medium term and maintaining the general government deficit below the 3% of GDP Treaty reference value.Full Implementation SDG 8, 16Ensurethefiscalsustainabilityofsocialprotectionandrebalancetaxrevenues towards more growth-friendly and sustainable sources.Some progressSDG 8,16Improve the efficiency of public spending by carrying out spending reviews and through better management of public investment.Some progressSDG 8, 162024 CSR 2Strengthen administrative capacity to manage EU funds, accelerate investments and maintain momentum in the implementation of reforms. Address relevant challenges to allow for continued, swift and effective implementation of the recovery and resilience plan, including the REPowerEU chapter, ensuring completion of reforms and investments by August 2026. Accelerate the implementation of the cohesion policy programmes. In the context of their mid-term review, continue focusing on the agreed priorities, while considering the opportunities provided by the Strategic Technologies for Europe Platform initiative to improve competitiveness.2024 CSR 3Some ProgressStrengthen competitiveness by boosting skills levels further, ensuring that the ongoing curricula reform also helps strengthen basic skills,Limited progress SDG 4by addressing labour shortages, andSubstantial progress SDG 8by promoting business dynamism and the creation of high-growth companies by improving the conditions for venture capital investment and institutional investors as well as investments in research, development and innovation.Some progressSDG 9, 8RRP implementation is monitored through the assessment of RRP payment requests and analysis of the bi-annual reporting on the achievement of the milestones and targets, to be reflected in the country reports. Progress with the cohesion policy is monitored in the context of the Cohesion Policy of the European Union.RRP implementation is monitored through the assessment of RRP payment requests and analysis of the bi-annual reporting on the achievement of the milestones and targets, to be reflected in the country reports. Progress with the cohesion policy programming is monitored in the context of the Cohesion Policy of the European Union. 
 
  
 
Graph A17.1: Labour productivity per hour 

ANNEX 17: COMPETITIVE REGIONS 

Favourable macroeconomic conditions and an 
upward trend in regional productivity provide 
an  opportunity  for  territorial  cohesion  and 
competitiveness  in  Slovenia.  Some  regions 
benefit  from  affordable  housing,  but  a  high  level 
of commuting presents challenges for sustainable 
transport.  The  installation  of  flood  protection  and 
the  phasing-out  of  coal  bear  medium-term 
potential  to  make  Slovenia's  regions  greener  and 
fairer. 

continues 

to  address  persistent 

The  Slovenian 
to 
economy 
experience  solid  growth,  with  GDP  per  head 
growth  averaging  1.8%  in  the  2022-2024 
period. This trend is expected to continue robustly 
in  2025  and  2026,  creating  a  favourable 
regional 
environment 
challenges.  Regional  economic  disparities  within 
Slovenia  have  remained  significant.  In  2023,  GDP 
per  head  (in  purchasing  power  standard,  PPS)  at 
national level was 92% of the EU average. It was 
particularly high in the capital region, at 136% of 
the EU average, which is 2.7 times higher than in 
the Zasavska region (50%). While Obalna-kraška in 
the  very  south-west  stood  at  87%,  Pomurska  in 
the very north-east was at 62%. 

Competitiveness 

The  productivity  gap  between  Eastern 
Slovenia  and  Western  Slovenia,  which 
includes  the  capital  region,  has  narrowed. 
During the period  2013-2022, annual  productivity 
growth  per  hour  worked  in  Western  Slovenia 
(1.4%) was slightly higher than in Eastern Slovenia 
(1.2%). This difference is less pronounced than the 
GDP per head development over the same period. 
Both  regions  fared  better  than  the  EU  average 
(0.9%)  in  this  period.  This  momentum  is  an 
opportunity  to  further  catch  up  with  the  average 
EU productivity level. In 2022, the capital region of 
Osrednjeslovenska  stood  at  94%  of  the  EU 
average  GDP  (PPS)  per  hour  worked  compared  to 
Pomurska (71%) and Primorsko-notranjska (72%).   

Unit: Real GDP per hour worked (EUR, 2015 prices) 
Source: ARDECO (JRC) 

innovation 

Slovenia  is  on  an  upward  trend  in  research 
and 
(R&I),  and  this  creates 
further momentum and opportunities for the 
regions.  In  2024,  Slovenia  remained  a  moderate 
innovator, with its R&I Performance Index at 91% 
of  the  EU  average.  While  this  places  Slovenia 
above  the  average  of  other  moderate  innovators 
(84.8%),  its  progress  is  slower  than  the  EU 
average (see Annex 3). On the Regional Innovation 
Performance  Scoreboard  (NUTS 2  level)  in  2023, 
Western  Slovenia  was  classified  as  a  Strong 
Innovator  (114),  with  a  very  high 
index  of 
international  scientific  publications  (377),  while 
Eastern  Slovenia  (92)  was  a  Moderate  Innovator, 
with a high index of lifelong learning (167). There 
is  a  performance  gap  in  basic  skills  among  15-
year-old  students  (in  maths,  reading  and  science) 
between rural or urban schools (224). 

boast 

regions 
frameworks,  with 

efficient 
Slovenia’s 
institutional 
recent 
improvements  in  local  governance  quality. 
While there is still potential  for improvements for 
all  Slovenian  regions,  for  example  in  digitalising 
the  administration  (see  Annex  6),  the 
latest 
NUTS 2  survey  from  2021  on  trust  in  local 
authorities shows that Slovenia has climbed three 
places  in  the  overall  EU-27  ranking  compared  to 
2017.  Indicators  included  the  quality,  impartiality 
and  level  of  corruption  of  the  administration. 
Eastern  Slovenia 
less 
developed  regions  in  new  Member  States  which 
score  above  the  EU  average.  Meanwhile  Western 

is  one  of  only  three 

(224) Programme for International Student Assessment 2022 - 

Slovenia 

105 

051015202530354045201220132014201520162017201820192020202120222015 EUR per hour workedOther NUTS3 regionsCapital regionNational averageEU27 
 
       
 
 
 
Table A17.1:Selection of indicators at regional level in Slovenia 

Source: Eurostat and JRC 

Slovenia,  including  the  capital  region,  is  among 
those  comparable  to  more-developed  regions 
elsewhere  in  the  EU  that  have  made  the  most 
noticeable leap forward (225). The current reform of 
in 
the  Balanced  Regional  Development  Act 
Slovenia  is  an  opportunity  to  further  increase 
people's  trust  in  local  government,  wherever  they 
live. 

Social fairness 

Housing  affordability 
in  Slovenia  varies 
significantly  between  regions,  shaping  both 
opportunities  and  growing  disparities.  House 
price  differentiation  is  a  territorial  strength  of 
some  regions  in  Slovenia.  In  the  northernmost 
alpine  region  of  Koroška,  the  average  household 
needs 5.9 years of average annual income to pay 
for  a  100 m2  dwelling  (house-price-to-income 
ratio),  whereas  in  the  coastal  region  of  Obalno-
in  the  southwest,  the  house-price-to-
kraška 
income ratio stands at 16.7 years. In line with an 
EU-wide  trend,  property  prices  in  coastal  regions 
tend  to  be  much  higher  than  in  the  rest  of  the 
country  with  the  exception  of  the  capital  region. 
Even  there,  the  house-price-to-income  ratio  is 
lower  (13.7),  as  salaries  in  and  around  Ljubljana 
are the highest in relative terms, (see Map A17.1). 
Despite  these  differences,  housing  affordability 
has  worsened,  with  house  price  growth  outpacing 
income  growth  in  most  regions.  While  home 

(225) DG REGIO study Measuring the Quality of Government at the 
Sub-National Level and Comparing Results with Previous 
Studies. 

ownership  remains  high,  the  lack  of  affordable 
housing  –  especially  in  urban  and  high-demand 
areas  –  poses  a  growing  challenge,  indicating  a 
need for targeted policy responses. 

Map A17.1:  House prices relative to income, 2019 

Source: European Commission, Mapadomo 

The  decarbonisation  of  energy  production  is 
a  core  regional  challenge  for  Slovenia, 
creating both challenges and opportunities to 
re-skill  employees  and  develop  renewable 
energies.  In  the  Savinjsko-Šaleška  region,  coal 

106 

GDP per head (PPS)Real GDP per head growthProductivity - GDP per person employed (PPS)Real productivity growth (per person employed)Productivity - GDP per hour worked (PPS)Real productivity growth (per hour worked)Population growthUnemploy-ment rateCO2 emissions from fossil fuels per headIndex EU-27 = 100Average annual % changeIndex EU-27 = 100Average annual % changeIndex EU-27 = 100Average annual % changeAverage annual change per 1000 residents% of labour forcetCO220232014-202320232014-202320222013-20222014-202320242022European Union (27 MS)1001.61000.61000.91.75.98.0Slovenija922.7851.3841.43.03.78.7Vzhodna Slovenija732.5771.3761.21.54.110.6Zahodna Slovenija1122.8921.2911.44.73.36.5 
 
 
 
 
 
  
 
mining  in  Velenje  and  the  Šoštanj  lignite  power 
plant  will  be  phased  out  by  2033  at  the  latest. 
Meanwhile,  the Zasavska region  is  addressing  the 
lingering  challenges  of 
its  earlier  unfinished 
transition  away  from  coal.  The  challenges  these 
regions  face  centre  around  the  expansion  of 
renewable  energies,  economic  diversification  and 
creating  new  job  opportunities.  These  regions  in 
Eastern Slovenia are benefiting from support from 
the EU Just Transition Fund, boosting, among other 
things,  the  re-skilling  of  the  workforce,  a  new 
district  heating  system  based  on  renewables,  and 
a hydrogen centre of excellence (see Map A17.2). 

Map A17.2:  Territories most affected by energy 
transition 

Source: DG REGIO 

Sustainability 

are 

increasingly 
Slovenia’s 
regions 
vulnerable  to  climate  change, 
including 
forest  fires and  flooding  (see  also  Annex  9). 
The  catastrophic  August  2023  floods  hit  many 
(mostly  northern)  regions  of  Slovenia 
in  an 
unprecedented  way.  However, 
installing  flood 
protection  measures,  including  those  co-financed 
by  the  EU,  is  a  significant  challenge  for  the 
administration  and  the  absorption  capacity  at  all 
levels.  Nature-based  solutions  have  the  potential 
to improve flood management around all riverbeds 
in  Slovenia’s  regions  (see  Map  A17.3)  and  could 
help achieve EU Nature Restoration Law targets. 

Map A17.3:  Regional impact of 2023 floods 

Source: International Federation of Red Cross 
Societies 

regions  are 

for  sustainable 

Regional  discrepancies  in  GDP  per  head  and 
house  prices  have  created  challenges  and 
transport. 
opportunities 
Variations  between 
less 
the 
pronounced when GDP is calculated per employee. 
The capital region then accounts for 113% of the 
national  average,  while  the  lowest-performing 
region,  Primorsko-notranjska,  stood  at  84% 
(figures  for  2023).  This  is  a  result  of  very 
substantial  daily  commuting 
into  the  Capital 
region, with its greater number of jobs (226) and its 
high house prices. 90% of all distances travelled in 
passenger  transport  in  Slovenia  are  made  by  car 
(EU  average  83%).  This  high  dependency 
is 
influenced by underdeveloped urban, intercity and 
interregional  public  transport  connections,  with 
significant regional disparities in infrastructure. For 
example,  regions  such  as  Goriška  (648  cars  per 
1 000 inhabitants) and Primorsko-notranjska (623 
cars  per  1 000 
show  higher 
motorisation  rates  compared  to  the  national 
average  of  579  cars  per  1 000  inhabitants.  This 
contrasts  with  Osrednjeslovenska,  which  is  the 
national  urban,  intercity  and  interregional  public 
transport hub, where the motorisation rate is lower 
Increased 
(555  cars  per  1 000 
investment 
transport  and 
regional  public 
multimodal  urban  transport  could  help  to  reduce 
greenhouse  gas  emissions  in  the  regions  and 
boost  the  modal  shift  from  road  to  rail  wherever 
possible. 

inhabitants). 

inhabitants) 

in 

(226) In  2024,  more  than  half  a  million  people  in  Slovenia, 
equalling 55.5% of the working population, commuted daily 
to  another  municipality  for  work.  141 500  commuted  into 
Ljubljana  (which  has  298 000  inhabitants).  Nationwide,  the 
percentage  of  people  commuting  to  work  has  increased  by 
almost  one  third  since  2003,  when  the  figure  was  42.3% 
(Source: Slovenian National Statistical Office). 

107 

 
 
 
 
 
 
 
 
Slovenia  has  a  competitive  advantage  in 
in  particular  waste 
circular  economy, 
management  and  recycling.  Slovenia  has  been 
above  the  EU  average  for  recycling  municipal 
waste  since  2015.  This  puts  the  country  among 
eight  Member  States  (Austria,  Belgium,  Denmark, 
Italy,  Luxembourg,  the  Netherlands,  and  Slovenia) 
which  have  achieved  recycling  rates  of  50%  or 
higher.  However  regional  differences  persist,  as 
separate collection – crucial for effective recycling 
–  varies  across  regions,  with  Savinjska  achieving 
the highest rate at 77.5% in 2023, while Obalno-
kraška  lagged  behind  at  64%.  This  creates  an 
opportunity  for  sustainable  waste  management 
across the board. This momentum can be used to 
overcome 
illegal 
landfilling in Bukovžlak near Celje, which is subject 
to an ongoing infringement case before the Court 
of Justice. 

regional  challenge  of 

the 

Slovenian regions face significant challenges 
in  wastewater  treatment,  with  the  capital 
region  notably  underperforming.  The  overall 
implementation  of  the  EU  Wastewater  Directive 
has  progressed  across  Slovenia.  While  regions 
such  as  Pomurska 
(100%  of  wastewater 
discharged from the public sewage system treated 
in treatment plants) and Obalno-kraška (92%) are 
already  in  compliance  with  the  standards,  the 
implementation rate remains at 61% (against the 
EU  average  of  80%).  At  present,  this  is  largely 
because  the  new  treatment  facilities  in  Ljubljana 
are set to be operational only by December 2026. 

108