Slovenia’s economy could contract by up to 16% due to coronavirus says central bank

Slovenia’s economy could contract by up to 16% due to coronavirus says central bank
By bne IntelliNews March 31, 2020

Slovenia’s economy could contract by between 6.2% and 16.1% in 2020 due to the huge consequences expected from the outbreak of coronavirus (COVID-19), the central bank said on March 31.

The Bank of Slovenia said it has prepared three possible scenarios which do not take into account the economic measures of the government to curb the economic damage. The government approved a €3bn economic package to mitigate the effects of the coronavirus crisis on economy, which is expected to be endorsed by the parliament on April 1.

Slovenia's private consumption is also expected to decline this year in the catering and hotel services, transport, recreation and cultural sectors, the Bank of Slovenia said.

The impact on the labour market will also be significant whereas the annual drop in employment is projected at 1.8-4.7% in the absence of measures, while the jobless rate could more than double.

The final effects on the labour market will depend in particular on the effectiveness of the proposed measures to mitigate the effects of the crisis.

Due to the economic contraction, Slovenia’s sovereign debt is expected to increase to between 70% and 80% of GDP.

Slovenia has so far reported 802 coronavirus cases and 15 related deaths.

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