The International Monetary Fund’s Executive Board completed the 2025 Article IV consultation with the Republic of Slovenia, endorsing the staff appraisal on a lapse-of-time basis, and the authorities consented to publication of the staff report. The IMF assessed that the economy has rebounded after a first-quarter 2025 contraction, with growth projected at 0.8 percent in 2025 and strengthening in 2026–27, while noting downside risks from escalating trade measures, uncertainty, and domestic reform or investment delays. Fiscal policy featured prominently as the general government deficit is projected to widen from 0.9 percent of GDP in 2024 to 2.2 percent in 2025 due mainly to post-flood reconstruction spending and a higher public sector wage bill, including a new winter holiday allowance; gross public debt is projected at about 66 percent of GDP in 2025. The IMF viewed the 2026 budget stance as moderately expansionary but indicated that a smaller deficit would better preserve fiscal space, and it recommended growth-friendly consolidation that combines expenditure efficiency with revenue measures such as broadening value added and personal income tax bases, strengthening revenue administration, and reforming the property tax, alongside efforts to reduce the labor tax wedge. On financial stability, banks were assessed as well capitalized, highly liquid, and profitable, with slightly higher risks linked to export-oriented manufacturers, implying continued monitoring of asset quality; the macroprudential stance was considered appropriate and the planned expiry of the bank asset tax at end-2028 was seen as supportive of capital buffers. The staff report is expected to be published shortly on the IMF’s Slovenia country page.

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