OECD projects drop of Slovenian economy by 7.8%

The Slovenian gross domestic product (GDP) might drop by 7.8% this year as well, due to the coronavirus crisis, according to the estimate of the Organization for Economic Cooperation and Development (OECD).

According to the up-to-date estimates of the OECD, published on Wednesday, in the case of the second wave of the COVID-19 epidemic this autumn, the Slovenian economy could drop by 9.1% this year, Seebiz portal reports.

If there is no second wave of the epidemic, the OECD projects a growth of 4.5% in Slovenia for 2021, but only 1.5% in case the epidemic returns.

Also, depending on whether there will be a second wave or not, the OECD, projects that the unemployment rate in Slovenia will be 6.4% or 6.9% this year and 5.4% or 8.1% next one.

As for the inflation, the OECD estimates that, in Slovenia, it will be 1% this year and 1.7-2% in 2021.

The OECD says that, so far, the Slovenian government has adopted fiscal measures for mitigating the economic consequences of the pandemic in the total amount of 4.5% of the GDP, but that additional measures for ensuring long-term sustainability of economic development in the new conditions are needed as well.

It especially warns that there's a need to solve the long-term, permanent unemployment and the need to reduce the ownership portfolio of the state in the economy, which it sees as too high.