​The 2024 European Commission Country Report on Slovenia provides an in-depth analysis of the nation's economic performance, fiscal health, and structural challenges within the framework of the European Semester. In 2023, Slovenia's economy demonstrated resilience, achieving a real GDP growth of 1.6%, surpassing the EU average of 0.5%. This growth was primarily driven by domestic demand, particularly in construction investment, which benefited from substantial inflows of EU funds, including those under the Recovery and Resilience Plan (RRP) and the 2014–2020 cohesion policy programme. Despite the devastating floods in the summer of 2023, which caused extensive damage to properties and infrastructure, the economy maintained its upward trajectory. Employment growth and rising real wages further bolstered consumer spending. Looking ahead, economic growth is forecasted to increase in 2024 and 2025, supported by improving external conditions, easing price pressures, and normalized inventory levels.

Inflation in Slovenia showed signs of moderation, decreasing from 9.3% in 2022 to 7.2% in 2023. This decline was largely attributed to falling prices of energy, goods, and food, while services inflation remained relatively high until the end of 2023 before moderating. Inflation is projected to decline further, reaching 2.2% by 2025. However, inflation excluding energy and unprocessed food remains somewhat higher than the headline figure, as service prices continue to rise rapidly.

The labor market in Slovenia remains tight, with labor shortages posing challenges to economic growth. In 2023, the employment rate reached a record high of 78%, and the unemployment rate dropped to a new low of 3.7%. Gross nominal wages increased by approximately 9.7%, while real wages grew by 2.1%. Several sectors, including construction, hospitality, and manufacturing, are experiencing significant labor shortages, with high vacancy rates and a substantial number of unfilled positions.

On the fiscal front, Slovenia's general government deficit is expected to remain below 3% of GDP in 2024. The withdrawal of most measures implemented to mitigate the economic and social impact of high energy prices contributes to this fiscal consolidation. However, expenditure related to flood reconstruction is projected to reach 1.0% of GDP in 2024, gradually declining in subsequent years. This expenditure will be partially offset by a higher corporate income tax rate and a new tax on banking assets for the period 2024–2028. Nationally financed public investment is anticipated to remain high, at 5.3% of GDP in 2024. Public finances will also be influenced by the gradual implementation of reforms in long-term care, health, and the public sector wage system. Notably, government debt dropped below 70% of GDP in 2023 and is on a declining path. In recent years, Slovenia has made significant progress in developing green budgeting techniques. 

In summary, Slovenia's economy exhibits resilience and positive growth prospects, supported by robust domestic demand and effective utilization of EU funds. Nonetheless, challenges persist, including labor shortages, inflationary pressures in services, and the need for continued fiscal discipline amidst reconstruction efforts and structural reforms. Addressing these issues will be crucial for sustaining economic growth and ensuring long-term fiscal sustainability.