Slovenia is located in central Europe and is bordered to the north by Austria, to the northeast by Hungary, to the south, southeast, and east by Croatia, and to the southwest by Italy. The nation has been a member of the European Union since 2004 and the Eurozone since 2007.
Slovenia is an independent, advanced, and stable nation and has had an open market economy since its transition in the 2000s. The nation has a population of about 2.08 million people. In the early 21st century the nation's economy was mainly based on services and trade. The transition to an open market economy has significantly improved the standards of living in rural areas and has produced the "tajkuni," a small group of individuals who have acquired immense wealth. A significant part of the economy has been privatized. The primary sources of income in the country come from the manufacture of pharmaceuticals, automotive parts, electrical appliances, and food processing.
Food and Beverage Sector
The food and beverage sector is among the most vital in the economy. About 704 companies were registered in the sector in 2015 employing about 12,658 people. The income generated from the sector amounted to $2.27 billion. The sector is among the third largest employers in processing activities alongside the production of electrical appliances and metal working. The biggest industries in the sector are meat processing, flour milling and baking, beverages production, and milk processing. The companies in the four industries provide about 30% of the jobs in the sector. The meat processing industry was most prominent in the food and technology sector in 2009 accounting for 30% of sales revenue, and it provided 28% of the jobs in the sector and contributed 22%of valued added. About a tenth of companies registered in the sector carry out milk processing and employs about 8% of the workforce in the sector. The beverage industry is comprised of non-alcoholic beverages, wine and beer production, and contributes about 16% of total sales revenues as well as about 12% of the jobs in the sector.
Chemicals and Pharmaceuticals
Companies in the chemicals and pharmaceuticals sector are among the most successful in the country. The sector is comprised of about 700 companies which employ about 26,000 people. About 72% of the sales from the sector are earned from the export market. Pharmaceuticals are the backbone of the sector and are followed by the tire and inner tube production and the manufacture of plastics. Chemical and pharmaceutical products in the country are among the most popular in the European Union. The ever-increasing demand for a high standard of health care is expected to ensure the continued growth of the sector and boost the nation as an attractive destination for pharmaceutical companies. The Sandoz Group and Krka are the top performers in the pharmaceutical industry and are regional leaders in the production of generic drugs. Some of the notable companies in the chemicals industry include Helios, Jub, Color, Henkel, and Julon. The only tire manufacturer in the country is Sava Tires which is owned by Goodyear Dunlop Tires Europe.
The automotive industry accounted for about a tenth of the nation's economy and accounted for 15% of exports in the country in 2011.
Non-metallic Mineral Sector
The non-metallic mineral sector consists of glass, cement, ceramics, and lime production industries. The sector mainly deals with the processing of naturally occurring minerals such as silica, limestone, and clay. The country has two main glass manufacturing plants, Steklarna Rogaska, and Steklarna Hrastnik. The glass industry is mainly export-oriented and provides a significant number of jobs in the sector. Some of the products in the glass industry include container glass, decorative products, and glass for lights. The country has two ceramics manufacturing plants, Gorenje Keramika Smartno ob Paki and Martex Volcja Draga. The nation also has two main cement production plants which are Lafrange Cement and Salonit Anhovo.
Iron and Steel Sector
The leading companies in the sector are Store Steel and Sij Steel Group. The companies are mainly export-oriented and produce steel products. The main products are heavy plates, cylinders, industrial knives, welding materials, alloy steel for implements, and stick steel for implements. The Sij Steel Group employs about 3,400 people with its annual product sales valued at an estimated $642 million. The Store Steel Company provides jobs for about 520 people and has yearly product sales value of $114 million.
The ICT sector is among the fastest growing in the country. Currently it employs more than 20,000 people and has over 2,600 companies. The growth of the sector is attributed to human capital development, government commitment to the sector which includes developing ICT infrastructure.
Slovenia maintains a tradition of trading with its neighbors making the economy vulnerable to the economic health of its neighbors. The nation’s economic growth in 2018 was 4.5 % with the rate expected to slow down to about 3.4% in 2019 and 2.8% in 2020. The country experienced a growth deficit in 2018 which reached 0.1%. The government expects a 0.4% budget surplus in 2019 while a deficit of 0.8% is expected by the IMF in 2019. Public debt fell from 78.6% of the economy in 2016 to 69.7% in 2018 and is expected to drop to about 67.5% in 2019. The average rate of inflation was 2.1% in 2018 and is expected to remain stable over the coming years at the rate of around 2%. The unemployment rate has been on the decline with the country experiencing a drop of 5.8% in 2018 which has been as a result of strong exports and increased consumption which boosted the demand for labor. The unemployment rate is expected to continue dropping with a 5.9% drop expected in 2019 and a 5.4% drop expected in 2020. In 2017 the poverty rate in the country was 13.3 %. A 2020 strategy for elderly persons in society is being implemented to address the high poverty rate among the senior population and marginalized minorities.
About the Author
Benjamin Elisha Sawe holds a Bachelor of Arts in Economics and Statistics and an MBA in Strategic Management. He is a frequent World Atlas contributor.
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