Slovenia’s Institute of Macroeconomic Analysis and Development (IMAD) has released its Spring Forecast, projecting GDP growth of 2.1% in 2025—a slight downward revision from previous expectations. Despite this adjustment, the Southeast European country’s economy is set to expand, fueled by private consumption, government investment, and a rebound in tourism-related services.
“Domestic consumption will be the primary driver of GDP growth this year,” stated Maja Bednaš, Acting Director of IMAD. She emphasized that rising wages, social transfers, and a resurgence in investment—particularly in government projects—will play a crucial role in economic expansion.
“Government investment activity will pick up, in particular due to the absorption of funds from the Recovery and Resilience Plan and the Fund for the Reconstruction of Slovenia, established in response to the 2023 floods”, she added.
Following last year’s strong but decelerating export growth, goods exports are expected to align more closely with foreign demand, while services exports are anticipated to accelerate further.
Key Growth Drivers in 2025
📌 Household Consumption & Tourism: Increased domestic spending will support growth in retail trade, tourism, and leisure-related services. The ongoing rise in spending by foreign tourists will provide an additional boost.
📌 Government Investment Surge: Public investment activity is set to rise, driven by funds from the Recovery and Resilience Plan and the Fund for the Reconstruction of Slovenia, established in response to the 2023 floods.
📌 Cautious Private Investment: While lower interest rates are expected to support housing investments, uncertainty in Slovenia’s export markets may lead to more cautious investment decisions among businesses.
📌 Moderation in Government Spending: Growth in government consumption will ease compared to 2024, though flood recovery efforts and the introduction of long-term care benefits in mid-2025 will still have an impact on public sector spending.
Despite external uncertainties and subdued recovery among Slovenia’s key trading partners, IMAD remains optimistic about sustained economic expansion in 2025, led by domestic demand and strategic government investments.
