Recommendation for a Council Recommendation on Slovenia’s 2013 national reform programme and delivering a Council opinion on Slovenia’s stability programme for 2012-2016

On 28 November 2012, the Commission adopted the Annual Growth Survey, marking the start of the 2013 European Semester for economic policy coordination. Also, on 28 November 2012, the Commission, on the basis of Regulation (EU) No 1176/2011 on the prevention and correction of macroeconomic imbalances, adopted the Alert Mechanism Report, in which it identified Slovenia as one of the Member States for which an in-depth review would be carried out.

On 10 April 2013, the Commission published the results of its in-depth review for Slovenia, under Article 5 of Regulation (EU) no 1176/2011. The Commission's analysis led it to conclude that Slovenia is experiencing excessive macroeconomic imbalances. Urgent policy action is needed to halt the rapid build-up of these imbalances and to manage their unwinding. Until now, the levels of private and public debt are below the alert thresholds of the scoreboard and also net external debt is relatively contained. However, the problem is not in the debt level but in its structure, which is highly concentrated in the corporate sector. In the context of accelerating negative economic trends, this undermines financial sector stability and complicates the deleveraging process, including through interlinkages with the level of sovereign debt. These risks are compounded by limited adjustment capacity in labour and capital markets and by an economic structure dominated by state-ownership. Periods of policy uncertainty and legal obstacles to reforms have prevented Slovenia from addressing its imbalances adequately and enhancing its adjustment capacity, thus increasing its vulnerability at a time of heightened sovereign funding stress.

On 9 May 2013, Slovenia submitted its 2013 stability programme covering the period 2012-2016 and its 2013 national reform programme. In order to take account of their interlinkages, the two programmes have been assessed at the same time.

EUR-Lex: COM(2013)374: Follow the progress of this recommendation through the decision-making procedure http://eur-lex.europa.eu/legal-content/EN/HIS/?uri=COM:2013:374:FIN

EUR-Lex: SWD(2013)374: Assessment of the 2013 national reform programme and stability programme for Slovenia http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=SWD:2013:374:FIN

ESO: Background Information: Website: Stability and covergence programmes submitted by member states 2006- http://www.europeansources.info/record/website-stability-and-convergence-programmes-1998/

---