03 Sep 2019, 12:30 PM

Shareholders Approve Sale of Marina Portorož

STA, 2 September - The shareholders of spa operator Terme čatež approved the sale of Marina Portorož to MMNT on Friday. The joint venture established by investment company Adventura Holding and Glen, a company owned by the management of furniture retailer Lesnina, is to pay EUR 21.6 million for the country's biggest marina, the newspaper Finance reports.

Minutes of the AGM, available on the web site of the agency for public records (AJPES), show that the sale of Marina Portorož received the backing of 99% of all votes present at the meeting. The AGM was attended by 98.9% of capital with voting rights.

The AGM also approved a division and takeover contract between Terme Čatež and Marina Portorož under which just under EUR 40 million in assets will be transferred in the takeover and a similar amount in liabilities.

Among other things, about EUR 33.5 million worth of property is to be transferred, as well as a 7.4% stake in DZS, the biggest owner of Terme Čatež.

The AGM also gave a new mandate to supervisors Ada de Costa Petan, Robert Krajnik, Rok Gorjup, Mitja Grum, Samo Roš and Goranka Volf. The supervisory board also includes three employee representatives.

The shareholders moreover decided not to cover EUR 5.5 million in loss, which several small shareholders intend to challenge.

03 Sep 2019, 11:00 AM

Lek Abandons Investment in New Factory at Prevalje

STA, 2 September 2019 - Lek, the Slovenian subsidiary of pharma company Novartis, has aborted its investment into expanding production in the town of Prevalje, north, where it has been present for more than 40 years. The decision seems to be have been made due to lower demand for generics following an in-depth analysis and studying all options.

"Despite lower demand on the generics market, especially in the US, over the recent years and despite the need for new technologies, Novartis has studied all options to realise the planned expansion.

"The analysis has shown the facility is suitable for introducing the technology of continuous manufacturing, but this has proved to be merely a short-term solution, so we decided not to continue the investment," Lek wrote in a press release on Monday.

The cornerstone for the additional facility for broad-spectrum antibiotics in Prevalje, a EUR 150 million investment, was laid in April 2017.

Production at what would have been Novartis's biggest investment in Slovenia to date was expected to be launched in 2020, bringing 140 much needed jobs to the Koroška region.

The Slovenian government had approved EUR 7 million in state subsidy for the new factory, which Lek was to receive in three years.

The company has so far received only EUR 1.5 million, but will return it by the end of the month, the Ljubljana-based company told the STA today.

The additional facility was completed at the end of 2018, but Novartis said already that spring that the purchase of technology for the new factory was suspended.

It explained the facility was first planned for classic production, but then it made it among possible locations for continuous manufacturing.

Last year Lek also decided not to co-finance a purification plant in Prevalje which would be used for Lek's waste waters.

Nevertheless, Novartis said today it was strengthening investment in new technologies in Slovenia.

However, the local community is extremely disappointed at the decision, regretting the loss of jobs and opportunities for the region's economic development.

"Today is a sad day not only for Prevalje, but for the entire Meža Valley and Koroška," Mayor Matic Tasič told the STA.

"Every investment is vital for entire Koroška, and of course we're interested in successful investments," said the director of the local chamber of commerce, Aleksandra Gradišnik.

She hopes Lek would implement its business plans, whatever they are, to the benefit of the region.

Tasič added "we did not expect a company with such a good reputation to afford to invest more than EUR 30 million and then abort the project".

Novartis is yet to decide what to do with the new facility.

The company, which employs more than 4,200 workers in Slovenia, has so far invested over EUR 2.3 billion in Lek, which makes it the biggest foreign investor in the country.

03 Sep 2019, 09:51 AM

Summary of Bled Strategic Forum, Day 1: Stability, Sustainability & the EU

STA, 2 September 2019 - The Bled Strategic Forum, the top event on Slovenia's foreign policy calendar, opened in Bled on Monday dominated by calls for action on climate change and appeals to multilateralism. The focus was on the challenges the EU faces and the role it could and should play in the new world order.

Slovenian Prime Minister Marjan Šarec, delivering the opening address, focused on the importance of ensuring stability and security through sustainability, and stressed that there was "an urgent need for a unified and coordinated approach towards global challenges".

According to him, clear recognition of scientific facts and immediate action are needed regarding climate change, water supplies and food security.

Šarec stressed that Slovenia was committed to a strong, cohesive and united EU, while ensuring solidarity and the highest standards of human rights and dignity.

Sustainable development was also in focus of Slovenian Foreign Minister Miro Cerar's address, who labelled sustainable development "our key priority".

Putting words into practice is the main responsibility, according to Cerar, who said that the burden of going sustainable and green should not fall on the shoulders of those who are already struggling now to cope with the changes in the globalised world.

The opening was also addressed by María Fernanda Espinosa Garcés, the president of the 73rd session of the UN General Assembly, who said that climate change was the "greatest challenge we must address".

She said that the planet had to increase the ambition towards green economy, taking immediate steps, such as public and private investments in low carbon, green jobs, otherwise the world would face instability.

Espinosa Garcés also pointed to the need to rework social contracts as there was an increasing inability of governments to protect their citizens, and to improve the health of the international system to counter the rise in nationalist sentiment.

The main panels of the first day of proceedings respectively tackled the challenges facing the EU and the current state of multilateralism.

The presidents of Slovenia and Estonia, Borut Pahor and Kersti Kaljulaid, spoke in favour of a strong EU as they discussed the future of the bloc.

Arguing that the EU was at a standstill that was unsustainable, Pahor proposed that the new European Commission and Parliament should consider initiating a constitutional process, something like the Convention on the Future of Europe in 2002 and 2003.

Kaljulaid agreed in principle but also suggested that the underlying question of whether the EU was useful or efficient might be misguided, especially if one tried to imagine what it would be like without the EU.

Two main immediate challenges for the EU were singled out: Brexit and migrations, issues that the Slovenian president said needed to be addressed if the EU was to be capable of dealing with more strategic questions.

A ministerial panel on multilateralism showed that multilateralism is under attack and that it can survive only if a concerted action is taken and global cooperation is maintained in order to tackle relevant challenges, including nationalism and narrow interests.

The notion that multilateralism is "under severe attack" was presented by Slovenian Foreign Minister Cerar, who said that some leaders were making mistakes by thinking that complex issues could be resolved by simple means.

"There are so many knots around the world that should be untied by diplomatic means, and they should not be simply cut," added Cerar.

Turkey's Foreign Minister Mevlüt Cavusoglu presented a nuanced picture of multilateralism, saying that his country was not moving away from European alliances.

"Doing business with one country does not mean that you are moving away from other parts of the world," he said, while criticising western allies for sometimes not providing assistance when needed.

His Spanish counterpart Josep Borrell Fontelles wondered how Europe would survive in the global world as its population is decreasing. In today's world, which he called "a world of G2 - China and the US", more stability would be provided by another superpower, with Europe having the capacity and economy for that, but only if it was united.

03 Sep 2019, 01:44 AM

Morning Headlines for Slovenia: Tuesday, 3 September 2019

Check the date at the top of the page, and you can find all the "morning headlines" stories here. You can also follow us on Facebook and get all the news in your feed.

A schedule of all the main events involving Slovenia this week can be found here

This summary is provided by the STA:

BSF opens with calls for stability and sustainability

BLED - The two-day Bled Strategic Forum (BSF) opened with addresses by senior Slovenian and UN officials who highlighted stability and sustainability as well as fighting climate change as the main factors for Slovenia and the EU and the world. PM Marjan Šarec called for a unified and coordinated approach to global challenges such as climate change, water supply and food security and Foreign Minister Miro Cerar said that the BSF would propose clear plans of action. UN General Assembly President María Fernanda Espinosa Garcés, who said that climate change was the "greatest challenge we must address". The event is attended by around 1,000 participants from some 60 countries.

Presidents hail friendship between Estonia and Slovenia

LJUBLJANA/BLED - President Borut Pahor and his visiting Estonian counterpart Kersti Kaljulaid noted genuine friendship between the two nations and many shared interests, as they addressed reporters after talks in Ljubljana. Pahor labelled the two countries as success stories. Kaljulaid said that Estonia and Slovenia advocated a strong Europe with clear goals such as the fight against climate change, and shared views on migrations, which she said were "no longer a crisis, but a fact". Kaljulaid and Pahor also took part in a BSF debate, speaking in favour of a strong EU as the best framework for European action.

Former Italian PM Letta honoured with Bled forum award

BLED - Former Italian Prime Minister Enrico Letta was honoured with the Bled Strategic Forum Distinguished Partner Award, conferred by the BSF and the Slovenian Foreign Ministry on prominent and engaged individuals who have embodied the principles espoused by Slovenia's largest foreign policy event. The presenter of the award, Ambassador Iztok Mirošič, praised individuals who "are a driving force of strategic thought, dialogue, progressive ideas for the mobilisation of the public, for the bettering of individuals, regions and the world, and thus also support and foster the ambitions, the mission and activities of the Bled Strategic Forum".

Cerar meets UN General Assembly president, ministers in Bled

BLED - Foreign Minister Miro Cerar held several bilateral meetings on the sidelines of the Bled Strategic Forum. He held talks with the president of the UN General Assembly, Maria Fernanda Espinosa Garces as well as the foreign ministers of North Macedonia and Turkey. Cerar and Espinoza Garces discussed the importance and role of multilateralism and ways in which it can be strengthened. In talks with ministers Nikola Dimitrov from North Macedonia and Mevlüt Cavusoglu from Turkey, the main topic was the countries' efforts to join the EU.

No news yet on Slovenian commissioner candidate's brief

BLED - Prime Minister Marjan Šarec told reporters that he had no information yet about the brief to be assigned to the Slovenian candidate for European commissioner Janez Lenarčič, even though he had talked to the European Commission's president elect Ursula von der Leyen twice. "As far as I know she intends to have another round of talks this week, and then she would probably decide," Šarec told the press on the sidelines of the Bled Strategic Forum.

Lek aborts investment in new factory at Prevalje

PREVALJE - Lek, the Slovenian subsidiary of drug maker Novartis, aborted its EUR 150 million investment into expanding production in the northern town of Prevalje where Lek has been present for more than 40 years. The decision appears to have been made due to lower demand for generics. "The analysis has shown the facility is suitable for introducing the technology of continuous manufacturing, but this has proved to be merely a short-term solution, so we decided not to continue the investment," Lek said, announcing it would return EUR 1.5 million it had already received in state incentives. The local community met the news with a bitter disappointment, not least because the plant was to create 140 new jobs.

Počivalšek sole candidate for SMC leadership

LJUBLJANA - Economy Minister Zdravko Počivalšek is the only candidate for the top job at the Modern Centre Party (SMC), with the deadline for bids passing on Saturday. The party's congress has been moved forward from 5 October to 21 September. The Ljubljana congress will mark the end of an era of Miro Cerar being at the helm of the party. Počivalšek decided to accept this challenge due to the support of the party's top echelons, in particular Cerar's seal of approval.

Terme Čatež AGM approves sale of Marina Portorož

ČATEŽ OB SAVI - The shareholders of spa operator Terme čatež approved the sale of Marina Portorož to MMNT on Friday, according to minutes of the AGM. The joint venture established by investment company Adventura Holding and Glen, a company owned by the management of furniture retailer Lesnina, is to pay EUR 21.6 million for the country's largest marina, the newspaper Finance reported. The shareholders also decided not to cover EUR 5.5 million in loss, which several small shareholders intend to challenge.

Eligma wins EUR 4m foreign investment

LJUBLJANA - Eligma, the Slovenian company providing smart commerce solutions, announced it had received a EUR 4 million investment from the Swiss Pangea Blockchain Fund and Bitcoin.com to finance its expansion in the global market. Eligma, which raised start-up capital in an initial coin offering, has developed the app Elipay, which allows instant cryptocurrency transfers, while the merchant gets paid in the local currency of choice, in order to avoid potential currency volatility.

New school year starts for 261,500 kids

LJUBLJANA - After ten weeks of holidays, a new school year started for roughly 74,000 Slovenian secondary school students and 187,525 primary school children. Among them, 20,840 six-year-olds entered school for the first time in their lives, with schools organising reception parties to welcome them. President Borut Pahor encouraged students to welcome new knowledge with open minds, and above all to think about everything with their own heads.

International schools increasingly popular

LJUBLJANA - International schools operating in Slovenia are mostly intended for foreigners, but interest has been growing also among Slovenian children. This year they will have 600 students. Three private international schools, the British International School of Ljubljana, the American QSI International School and France's Ecole Francaise Ljubljana, each teach curricula from the countries of their origin. Internationally compatible courses are also offered by several Slovenian public schools.

British author sets explosive debut novel in Slovenia

LONDON, UK - British chemical engineer and author Fiona Erskine has set her literary debut The Chemical Detective in the snowy slopes of the Slovenian Julian Alps. The crime novel revolves around Dr Jaqueline Silver who works on avalanche control and finds herself caught in a cobweb of lies, mysteries and threats after uncovering an international chemical smuggling operation. According to Aurora Walshe, editor of magazine Chemistry World, the novel is fast-paced and thrilling.

UEFA to hold football match in Ljubljana

NYON, Switzerland - The UEFA management will visit Slovenia at the initiative of its boss, Slovenian Aleksander Čeferin. The European football's governing body will hold a couple of events on the margins of its executive committee assembly in Ljubljana on 24 September. UEFA will first launch Football in Schools, a new project for the 2020-2024 period which includes two Slovenian schools and one from each of Slovenia's neighbours. It will also hold a football match in Ljubljana's Republic Square.

Visiting Ljubljana? Check out what's on this week, while all our stories on Slovenia, from newest to oldest, are here

If you're learning Slovenian then you can find all our dual texts here

02 Sep 2019, 21:30 PM

Vice-Mayor of Koper Caught Drunk and Driving Wrong-way

September 2, 2019

In the small hours of last Thursday, security cameras on the littoral highway caught someone driving the wrong way from Postojna towards Kozina.

Detailed information about the incident leaked to public over the weekend, revealing not only that the driver was dead drunk but also who he was. Patrik Peroša, vice-Mayor of Koper, responsible for the development of sports and healthy lifestyle in the municipality, sat behind the wheel with an unbelievable 1.91 mg of alcohol per litre of exhaled air (or 0.92 g of alcohol per 1 kg of blood).

To get the idea of what the numbers mean, here is a scale of penalties a drunk person behind a wheel can face.

Level of drunkenness	Fine in EUR	Licence penalty points (max 18 points in three years; 7 for young drivers)	Other sanctions
Up to 0.50g of alcohol per 1 kg of blood or 24 mg/l exhaled air and doesn’t show any behavioural disorder	300	4	/
More than 0.50 up to including 0.80g of alcohol per kg of blood or 0.24 to including 0.38mg alcohol / l of exhaled air	600	8	Possibility of 4 penalty points deleted if driver agrees to medical examination and consultation with a physician
More than 0.80 up to including 1.10 g alcohol per 1kg of blood or 0.38 to including 0.52 mg alcohol / l of air	900	16	Possibility of 4 penalty points deleted if driver agrees to voluntary rehabilitation programme
More than 1.10g of alcohol per kg of blood or more than 0.52 mg/ litre of exhaled air.	1200	18	Police can detain such a driver, driving licence can be cancelled. Licence withdrawal can also be postponed if a controlled health check and adequate rehabilitation programme is attended.

Peroša didn’t need to spend a sobering night at the police station, since his wife came to pick him up. However, he did offer his resignation to the mayor of Koper, Aleš Bržan, who accepted it.

You can see the video of the incident here.

02 Sep 2019, 17:34 PM

Slovenian MEP Joins Call to Investigate Suspension of UK Parliament

STA, 1 September 2019 - Slovenian MEP Milan Brglez (SD/S&D) has joined an appeal by a group of MEPs asking the European Commission to examine whether British Prime Minister Boris Johnson's move to suspend parliament is in breach of EU law.

"It is a sad day for development of democracy and the rule of law in British and all-European history. Parliaments are the essence of a country's democratic system (...) So their work should be enhanced rather than hampered," said Brglez, who served as Slovenian parliamentary speaker between 2014 and 2018.

"There have always been differences in views on how democracy should develop and there always will be (...) but it is wrong if the politically stronger party substitutes the argument of power for the power of arguments and uses the leverage it has against democracy and democratic procedures."

Arguing that this is exactly what the British government has done, Brglez joined the appeal drawn up by British MEP Anthony Hook (RE), for the Commission to examine potential breach of the EU's basic values and principles under Article 7 of the Treaty on EU, which has been used to censure the governments of Poland and Hungary.

All our stories on Brexit are here

02 Sep 2019, 15:00 PM

Bitcoin.com & Pangea Blockchain Fund Invest in Eligma to Ease Shopping with Crypto

1 September 2019 - Eligma is a Slovenian blockchain company that launched in 2018, and one aim of the firm is to make cryptocurrencies part of daily life, and thus of shopping. To this end it has produced Elipay, an infrastructure for accepting crypto payments (in Bitcoin Cash, ELI, Bitcoin and Ether) that ensures the merchant always receives settlement in the local fiat currency. It is this service that has drawn the attention of Roger Ver’s Bitcoin.com and the Swiss firm Pangea Blockchain Fund, which together will invest €4 million in the Slovenian start-up.

According to a press release, it is Elipay and the related app that have made Slovenia the leading country in the world with regard to the number of brick-and-mortar stores and service providers that accept both regular money and crypto. The investment is aimed at helping Elipay expand beyond its current markets of Slovenia and Croatia, where more than 430 businesses now accept crypto currencies on a daily basis.

Eligma CEO Dejan Roljic is quoted as saying: “The development of finance is going towards cash becoming a thing of the past. Among other things, this is because doing business with it is quite time-consuming and expensive. On the other hand, one of the main problems with cryptocurrencies is that the confirmation of transactions can take several minutes if not more, which is unacceptable in daily shopping. Eligma effectively solved this problem with Elipay, which enables instant crypto transactions; furthermore, the merchant receives settlement in local fiat and is thus safe from crypto volatility. This makes the use of cryptocurrencies quick and effective for daily use. We must not forget that cryptocurrencies were envisioned as the electronic cash of the future.“

Shopping with Elipay is said to be very easy: the buyer scans the purchase QR-code with a crypto wallet, selects the cryptocurrency they wish to use and confirms the transaction. The current list of Elipay locations can serve more than 20,000 users of the Elipay app, along with some 4 million users of the Bitcoin.com Wallet, with other crypto wallets expected to join the system soon. Users of Elipay can also benefit by receiving Eligma (ELI) tokens with every purchase they make. The all-time high of the token was US$0.050306 on 5 September 2018, and it is currently trading at US$0.021759.

You can learn more about Eligma here, while all our blockchain stories are here

02 Sep 2019, 13:32 PM

Feature: Interest in International Schools Growing in Slovenia

STA, 2 September 2019 - Among the many primary and secondary schools children can go to in Slovenia, there are also several international schools, which are mostly intended for foreigners. Interest in them has been growing, also among Slovenian children, so this year they will have 600 students.

There are three private international schools: the British International School of Ljubljana, the American QSI International School and France's Ecole Francaise Ljubljana.

They teach curricula from the countries of their origin, at the same time offering curricula taught within the global network of international schools.

The three schools had some 400 students in the 2018/19 school year, according to data provided by the British school.

But there are also several Slovenian public schools offering internationally-compatible courses.

One of them is Danila Kumar Primary School in Ljubljana, which has launched an international department upon the initiative from foreign diplomats and business executives.

Since its first year, 2007/2008, the number of its students has grown from 50 to around 200.

"The figure changes since children get enrolled and leave throughout the year. They are 3 to 15 years old," says Irena Šteblaj, head of the primary school's international department.

She has told the STA they generally accept foreign citizens, while Slovenian students are admitted if they have already studied abroad and intend to go abroad again.

Our Danila Kumar International School usually has children of 36 to 40 different nationalities, says Šteblaj.

She admits some may have problems when they continue schooling at secondary school because of a language barrier.

"Although they study Slovenian two hours a week here, they don't learn it as well as if they went to a Slovenian school."

Three Slovenian secondary schools also offer an international school-leaving exam - known in Slovenian as "matura".

These are Gimnazija Bežigrad in Ljubljana and II. Gimnazija in Maribor, and since last year also Gimnazija in Kranj.

In Maribor, the two-year programme which prepares students in the last two years for the matura exam has been available since 1990.

To qualify for such such a programme, students must have good grades, an average of at least 4 on Slovenia's 1-to-5 scale.

"Classes are held in English, but students also have to attend lessons in their own mother tongue," says II. Gimnazija Maribor headteacher Ivan Lorenčič.

This year 22 Slovenian and 10 foreign students passed the international matura exam at this secondary school.

If they pass the exam, they can continue their studies at any university in Slovenia or abroad.

"But the majority, as many as 60-70%, decide to go abroad, to study mostly science such as chemistry, microbiology, biology and similar," says Lorenčič.

He is proud to say that the students passing the international mature exam at Slovenian secondary schools are at the top of more than 1,300 such schools worldwide.

"This is a result of hard work," he believes.

Meanwhile, a school for children whose parents work for EU institutions was launched in Ljubljana last school year.

In the first year, ten children were enrolled in grades 1 and 2 at the Ljubljana European School, which was founded by the government.

Children can choose between a programme taught in English or Slovenian, which according to headmaster Darinka Cankar depends on the dominant language spoken in their families.

Children also have the option of their mother tongue classes, which means that in 2019/20 the school will also teach French, German, Spanish and Lithuanian.

Forty-six children will attend it this year, the majority of whom are foreign citizens.

All out stories on education in Slovenia are here

02 Sep 2019, 12:00 PM

Back to School for Around 261,500 Children in Slovenia

STA, 2 September 2019 - After ten weeks of holidays, a new school year starts on Monday in Slovenia for roughly 74,000 secondary school students and 187,525 primary school children.

It was an especially big day for the 20,840 six-year-olds who entered school for the first time in their lives with schools throwing reception parties to welcome them in their midst.

In his message at the start of a new school year, Education Minister Jernej Pikalo wished everyone to benefit from school for new knowledge and friendships, assessing that school was one of the best social subsystems in Slovenia.

Meanwhile, President Borut Pahor encouraged students to welcome new knowledge with open minds, and above all to think about everything with their own heads.

As is usual for this time of year, campaigns have been launched to raise awareness among drivers and the public of the presence of schoolchildren in traffic, promote tolerance and safety.

Police officers and volunteers from motorists' associations are seeing to the safety of schoolchildren, in particular the youngest ones at spots where they are most exposed to risk.

Year-one kids were wearing yellow neckerchiefs and holding yellow balloons to alert drivers to watch out for them.

At the Simon Jenko primary school in Kranj, Slovenia's football team members helped pupils cross the street, with Infrastructure Minister Alenka Bratušek highlighting the importance of visibility and caution in traffic.

There will be some changes awaiting primary schoolchildren such as updated syllabus for Slovenian and the optional subject beekeeping, and new optional subjects of film education and Slovenian sign language.

Marking the introduction of the latter, Pikalo visited on Monday the Ljubljana School for the Deaf, welcoming primary school children and wishing them they would feel good in school every day and not just on their first day. The school provides education for 27 year-one kids this year, including five deaf pupils.

New courses await secondary school students and an extended selection of courses in which they can do apprenticeship. Those coming of age will no longer be able to write their own excuse notes.

Teachers will benefit from higher salaries as these will go up by one pay bracket as of 1 November. Form teachers will get a pay rise as early as this month.

The longest term holidays this year will be for Christmas and New Year, between 25 December and 5 January. The first break will be the week between 28 October and 1 November.

All our stories about education in Slovenia are here

02 Sep 2019, 10:24 AM

Slower GDP Growth for Slovenia in Q2, Still Up 2.5%

STA, 30 August 2019 - Slovenia's economy expanded at an annual rate of 2.5% in the second quarter of the year in real terms, or by 2.6% when adjusted for season and working days. Both figures indicate a slow-down compared to the previous quarter.

The seasonally-adjusted quarter-on-quarter GDP growth ran at 0.2%, data released by the Statistics Office show. This too is a 0.4 percentage-point slow-down compared to the first quarter.

Revised data put the annual growth rate for the first quarter at 3.3% in real terms, 0.1 of a percentage point up from the previous estimate.

Seasonally adjusted annual growth in the second quarter was 0.9 percentage points slower than in the first quarter.

The Statistics Office noted the strong growth in exports and imports in the second quarter.

However, since imports grew at a faster pace than exports, this had a negative impact on GDP growth of 1.3 percentage points.

Addressing reporters in Ljubljana, Romana Korenič from the Statistics Office said that a slow-down was observed in all sectors, but she was not surprised by the 0.2% quarterly growth.

"I was much surprised by the strong external demand considering the situation in the European markets. Given the data in our trading partners I expected even slower pace of growth. Exports are extremely important for Slovenia," she said.

She added that exports were driven by industrial expenditure, whose growth in the second quarter outpaced that in the quarter before.

Exports increased by 9.4% and imports by 12.3%, the highest rates in a year and a half.

Domestic expenditure increased by 4.2% in the second quarter of 2019 due to stronger final consumption expenditure (+2.7%) and gross capital formation (3.5%).

The pace of growth was 1.5 percentage points faster than in the first quarter, but still 0.8 percentage points lower than the final quarter of 2018.

Household final consumption increased by 3.4%, 1.1 percentage points stronger growth than in the previous quarter, but 0.2 points slower than the quarter before.

Final government consumption expenditure increased by 1%, which is significantly less than in the previous quarters.

Gross capital formation expanded by 9.2%, with gross fixed capital formation increasing by 6.9%, which is a 3.1 percentage-point slow-down compared to the first quarter.

The increase in gross fixed capital formation was more prominent in construction (13.4%), while the increase in machinery and equipment (1.3%) was considerably lower than in the previous quarters.

After more than four years of continuous growth, gross fixed capital formation in transport equipment (mainly vehicles) decreased by 6.2%, while gross fixed capital formation in other machinery and equipment increased by 4%, a slow-down after more than two years of double-digit growth.

Changes in inventories had a positive impact on GDP growth; this time they contributed 0.6 of a percentage point.

The total number of people in employment in the second quarter of 2019 was 1,043,907, an increase of 2.6% y/y. Most new jobs were created in manufacturing, construction, transport, trade, and professional, scientific and technical activities.

The data will be an important indicator for the government economic forecaster IMAD, which will release its autumn forecast in the second half of September. It currently projects a 3.4% growth for this year.

IMAD noted that the annual rate of growth in the first half of the year was 2.9% in real terms, which means that despite the slow-down the rate remains high above EU average, seasonally adjusted at 1.3%.

IMAD also noted expanding domestic consumption, in particular household consumption, as the biggest contribution to growth.

"The growth in private consumption is rising even faster than we expected in spring, which we attribute to favourable trends in the labour market, the continuing high level of consumer confidence, as well as reduction of the tax burden on earnings," IMAD director Maja Bednaš commented.

The slow-down in investment in equipment and machinery is linked to a moderate growth in foreign demand, with IMAD noting that export orders have been slowing down since the second half of 2018.

This has not reflected in export growth yet because the slow-down in the international environment has been offset by accelerated exports in some product groups, such as pharmaceutical or medical products.

Pointing to dampened consumer and business confidence in Slovenia and the EU, coupled with the increased uncertainty and risks in the international environment, IMAD expects the outlook for the export economy to deteriorate later in the year.

"For next year, all international institutions project a slightly higher growth again for our leading trading partners, which we will take into consideration in the IMAD autumn forecast," Bednaš said.

Similarly, the central bank noted that the slow-down in Slovenia was due to the slow-down in the euro economy, while projecting slower rates of growth to continue for the same reason until the end of the year.

"Growth is still driven mainly by growth in merchandise exports and value added in industry, which has even been boosted compared to the first quarter," said Banka Slovenije.

The central bank also noted that the economic slow-down is already being reflected in the labour market with a slight slowdown in the growth in total employment and the nominal growth in average pay falling below 4% in May and June.

The Statistics Office also revised data for GDP growth in 2018, to 4.1% in real terms, which is a 0.4-percentage point downgrade from the February estimate, and a 0.7-percentage point drop from 2017.

GDP at current prices in 2018 amounted to EUR 45.755 billion, a 6.4% growth compared to 2017.

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