News


News

Development Report: Slovenia back on track to convergence with more developed member states

Back on track to convergence with more developed Member States, Slovenia has been moving towards an inclusive society in the last few years; it has also reduced pressures on the environment. In certain areas developments have deviated significantly from the principles of sustainable development and pose a risk to the achievement of the SDS’s primary objective. To achieve the SDS’s central goal, it is essential to ensure more sustainable development by balancing its economic, social and environmental components.

This year’s Development Report presents an overview of development baselines according to the strategic orientations set out in the Slovenian Development Strategy 2030 (SDS) adopted by the government of Slovenia at the end of 2017. The SDS’s primary goal is to ensure a high quality of life for all by realising the following strategic orientations: (i) a highly productive economy that creates value added for all; (ii) lifelong learning; (iii) an inclusive, healthy, safe and responsible society; (iv) a well-preserved natural environment; and (v) high levels of cooperation, competence and governance efficiency.

Back on track to convergence with more developed Member States, Slovenia has been moving towards an inclusive society in the last few years; it has also reduced pressures on the environment. After widening significantly during the crisis, Slovenia's development gap with the EU average started to narrow in 2016 owing to measures to stabilise economic conditions, the strengthening of the economic cycle and improved competitiveness. With the recovery of the economy, household income also resumed its growth, and the risk of social exclusion – which is relatively low by international standards – had fallen to its 2008 level by 2016. The recovery was recorded in the majority of sectors and regions and labour market conditions started to improve for people of most age groups and levels of education, which indicates that Slovenia is moving towards an inclusive society. Certain moves have also been made towards reducing the impact of economic activities on the environment, though the slower growth of energy consumption and emissions compared with GDP growth was, in addition to measures adopted, also due to the structure of GDP growth and milder winters. With the strengthening of economic activity, the environmental burden has thus also started to rise.

In certain areas developments have deviated significantly from the principles of sustainable development and pose a risk to the achievement of the SDS’s primary objective. The sustainability and stability of economic development and the consequent improvement in the living standards and wellbeing of the population are threatened by relatively low productivity growth and only slow adjustment to demographic change. From the point of view of creating an inclusive society, particularly the high labour market segmentation of young people and the relatively low economic and social inclusion of older people stand out as problematic. From the environmental point of view, sustainable development is threatened primarily by high (and rising) GHG emissions from transport, the interrupted increase in the share of renewable energy sources and unsustainable use of land.  

To achieve the SDS’s central goal, it is essential to ensure more sustainable development by balancing its economic, social and environmental components. Priority measures of development policies should be focused on the following:

-    Acceleration of productivity growth for economic progress and higher living standards. It is essential to strengthen long-term productivity factors, particularly by (i) investment in R&D to support high-quality research work and stable, long-term measures for fostering innovation and accelerating the digital transformation of the economy and society and (ii) a more rapid adjustment of education and training programmes to labour market needs and technological changes.
-    Adjustment to demographic change to ensure a decent life for all and long-term sustainability of public finances. The emphasis should lie on (i) reforming social protection systems, (ii) strengthening lifelong learning, (iii) promoting a healthy lifestyle and (iv) adapting working and living environments.
-    Transition to a low-carbon circular economy to reduce the environmental burden and enhance the competitiveness of the economy.This requires a shift towards more sustainable production and consumption patterns, especially by (i) a sustainable and efficient exploitation of natural resources, (ii) a more sustainable mobility system and (iii) education and raising awareness of the urgency of changes towards sustainable development.
-    Increase in the efficiency of the government and its institutions to support and promote development by (i) reforming the strategic governance of public institutions, (ii) improving the legislative and business environment and (iii) restructuring general government revenue and expenditure to respond to development challenges, particularly those related to the impacts of demographic change.