.^'IMAD O fü Q) £ u E o >< O Ü) O u 0) m CD f^ cu .Q E cu > o Slovenian Economic Mirror ISSN 1318-3826 No. 11 / Vol. XIX / 2013 Publisher: IMAD, Ljubljana, Gregorčičeva 27 Responsible Person: Boštjan Vasle, MSc, Director Editor in Chief: Tina Nenadič, MSc Authors of Current Economic Trends (listed alphabetically): Jure Brložnik, Urška Brodar, Gonzalo Caprirolo, MSc, Janez Dodič, Marjan Hafner, MSc, Matevž Hribernik, Slavica Jurančič, Mojca Koprivnikar Šušteršič, Janez Kušar, Urška Lušina, MSc, Jože Markič, PhD, Tina Nenadič, MSc, Mitja Perko, MSc, Jure Povšnar, Ana T. Selan, MSc, Dragica Šuc, MSc Author of Selected Topic: Valerija Korošec, PhD (Life satisfaction); Mateja Kovač, MSc (Agricultural production and food security) Editorial Board: Lidija Apohal Vučkovič, Marijana Bednaš, MSc, Lejla Fajič , Alenka Kajzer, PhD, Rotija Kmet Zupančič, MSc, Janez Kušar, Boštjan Vasle, MSc Translator: Marija Kavčič Data Preparation and Graphs: Bibijana Cirman Naglič, Marjeta Žigman Concept and Design: Katja Korinšek, Pristop DTP: Bibijana Cirman Naglič Print: SURS Circulation: 80 copies © The contents of this publication may be reproduced in whole or in part provided that the source is acknowledged. Contents In the spotlight................................................................................................................................................................3 Current economic trends..............................................................................................................................................5 International environment...............................................................................................................................................7 Economic developments in Slovenia.............................................................................................................................8 Labour market..................................................................................................................................................................16 Prices..................................................................................................................................................................................18 Balance of payments.......................................................................................................................................................20 Financial markets.............................................................................................................................................................22 Public finance....................................................................................................................................................................24 Boxes Box 1: Gross domestic product, Q3 2013.....................................................................................................................10 Box 2: Impact of regional structure on exports of goods.................................................................................................11 Box 3: Road and rail freight transport in Q2 2013.............................................................................................................15 Selected topic Life satisfaction.................................................................................................................................................................29 Agricultural production and food security.................................................................................................................31 Statistical appendix.....................................................................................................................................................33 The Economic Mirror is prepared based on statistical data available by 6 December 2013. On January 2008, the new classification of activities of business entities NACE Rev.2, which replaced NACE Rev. 1.1, came into force in all EU Member States. In the Republic of Slovenia, the national version of the standard classification, SKD 2008, which includes the entire European classification of activities but also adds some national subclasses, came into force on the mentioned date. In the Slovenian Economic Mirror, all analyses are based on the SKD 2008, except when the previous SKD 2002 classification is explicitly referred to. More general information about the introduction of the new classification is available on the SURS website http://www.stat.si/eng/ skd nace 2008.asp. All seasonally adjusted data in the Economic Mirror are calculations by IMAD. In the spotlight According to the forecasts by the EC and the OECD, euro area economic activity will drop slightly this year and increase in 2014. In the third quarter GDP remained down year-on-year, despite a further modest quarterly increase (0.1%, seasonally adjusted). The EC and OECD project euro area GDP to decline slightly again (-0.4%) this year and to increase by around 1.0% in 2014 due to stronger external and domestic demand in response to the expected improvement in business and consumer confidence, slower fiscal consolidation and low inflation. Economic growth will continue to be constrained by corporate and household deleveraging, financial market fragmentation and high unemployment. Both institutions regard the completion of the banking union and a further implementation of structural reforms as the top priorities of the euro area. Slovenia's GDP remained unchanged in the third quarter (seasonally adjusted). The smaller year-on-year fall in GDP (-0.6%) than in previous quarters was mostly due to the positive contribution of changes in inventories. The contribution of net exports remained unchanged, as amid a higher growth in exports relative to the same period last year, imports also increased year-on-year for the first time after the first quarter. The year-on-year declines in household and government final consumption and in investment activity deepened, which indicates a continuation of the adverse situation in the domestic environment. Value added remained down year-on-year in most sectors. The labour market situation is easing, but remains tight. After still dropping at the beginning of the year, employment has remained unchanged since the middle of the year, while registered unemployment, which rose sharply in the first half of the year, has stopped rising in the last few months. An average of 119,460 persons were registered as unemployed in the first ten months, more than in the same period last year (9.3%), which is mainly due to a higher number of first-time jobseekers and persons who registered as unemployed because of the termination of their fixed-term employment contracts. On the other hand, more persons found work than in the same period last year, primarily due to a greater involvement of the government in the implementation of active employment-policy schemes, fewer breaches of regulations and fewer retirements. The average gross earnings in the first nine months were lower than in the same period of last year due to a decline in the general government sector. In the private sector they were roughly the same as a year earlier. Consumer prices fell in November, while year-on-year inflation remained unchanged. Monthly deflation was mainly marked by lower prices of liquid fuels and unprocessed food. Year-on-year inflation remained at previous month's level in Slovenia (1.3%), while rising slightly in the euro area, according to Eurostat's flash estimate. The problems in the Slovenian banking system are deepening. The stock of loans to domestic non-banking sectors shrank by EUR 1.7 bn in the first ten months. Households are deleveraging this year, and the stock of government loans also declined after last year's growth. Enterprises and NFIs continue to repay domestic bank loans, while borrowing abroad this year, mainly in the form of long-term loans. Banks are repaying liabilities abroad, with net repayments totalling EUR 1.7 bn in the first nine months. The quality of banks' assets keeps deteriorating. The proportion of bad claims, having reached 17.5% of the banking system's total exposure in September, rose by EUR 1.4 bn in the first three quarters, more than in the entire year 2012. The consolidated balance of public finance recorded a deficit of EUR 1.3 bn in the first nine months. Revenue (EUR 10.6 bn) was down 2.4% in the first nine months, while expenditure (EUR 12.0 bn) was down 0.2%. Tax revenue remained lower than in the same period last year, particularly revenue from corporate income tax. Among expenditure categories, expenditure on wages, goods and services and social transfers (except pensions) declined in particular. The deficit was up EUR 234 m year-on-year. Since July the deficit has not been growing year-on-year, which can be explained by a smaller year-on-year drop in revenue, mainly on account of higher VAT revenue in the last three months. ■o £ Q) E o £ 0 u 01 £ 01 3 U International environment In the third quarter euro area GDP increased modestly again (0.1%, seasonally adjusted) and remained down year-on-year (-0.4%). The quarterly growth mainly stemmed from changes in inventories, while the contribution of net exports (having been positive in the second quarter) was negative.1 Among Slovenia's main trading partners, the largest GDP increase was recorded by Germany.2 Growth was mainly due to higher domestic demand. Private and government consumption rose, as did gross investment, both in machinery and equipment and in the construction sector. Contrary to the Commission's forecasts, France recorded a slight decline in economic activity in the third quarter due to lower domestic demand and net exports. The only positive contribution came from changes in inventories. Figure 1: Economic growth in Slovenia's main trading partners ■ 04 12 BQ! 13 »02 13 »03 13 -0.8 -1.0 EMU Germany France Italy Austria Source : Eurostat. The forecasts of the European Commission and the OECD released in November predict a 0.4% decline in euro area GDP this year. Both institutions expect a gradual recovery of the euro area economy next year (1.1% or 1.0% GDP growth, respectively), albeit slower than projected in the spring. At the same time they point to stronger downside risks in the international environment, which are associated with slower growth in developing countries and uncertain fiscal policy in the US (a possibility of renewed problems related to the debt ceiling increase, the announced decline in bond purchases). According to the Commission's and the OECD's expectations, exports will continue to make a substantial contribution to the strengthening of economic activity in the euro area this year, while in the next two years domestic demand will gradually become the main driver of economic growth under the impact of the expected improvement in business and consumer confidence, diminished uncertainty, slower speed of fiscal consolidation and low inflation. Economic growth will continue to be dragged down by corporate and household deleveraging, financial market fragmentation and high unemployment in the euro area.3 Both institutions estimate that the creation of a banking union and the continuation of structural reforms are the key to a more sustainable recovery of economic activity in the euro area. The conditions on financial markets continued to improve in November. Uncertainty about the movements on government bond markets in the euro area declined further in November. The required yields of government bonds dropped in the countries with the highest ratings and the most exposed countries, where they did not exceed 6.0%. The ECB contributed to the stabilisation by lowering the key interest rate. The situation on EU stock markets is also improving, which is indicated by growth in the main stock exchange indices and a decline in uncertainty indicators. Table 1: Comparison of GDP growth forecasts by international institutions for 2013 and 2014 2013 2014 IMF EC CONS OECD IMF EC CONS OECD Oct 13 Nov 13 Nov 13 Nov 13 Oct 13 Nov 13 Nov 13 Nov 13 EU 0.0 0.0 0.0 N/A 1.3 1.4 1.3 N/A EMU -0.4 -0.4 -0.4 -0.4 1.0 1.1 0.9 1.0 DE 0.5 0.5 0.5 0.5 1.4 1.7 1.7 1.7 IT -1.8 -1.8 -1.8 -1.9 0.7 0.7 0.5 0.6 AT 0.4 0.4 0.4 0.4 1.6 1.6 1.5 1.7 FR 0.2 0.2 0.1 0.2 1.0 0.9 0.8 1.0 HR -0.6 -0.7 -0.7 N/A 1.5 0.5 0.8 N/A RUS 1.5 1.9 1.6 1.5 3.0 3.0 2.5 2.3 US 1.6 1.6 1.7 1.7 2.6 2.6 2.6 2.9 Source: IMF World Economic Outlook (October 2013), European Economic Forecast Autumn 2013 (November 2013), Consensus Forecasts (November 2013), OECD Economic Outlook (November 2013). Note: N/A - not available. 1 In the third quarter the largest contribution to the year-on-year growth (-0.4%) came from net exports (0.2 percentage points). Private consumption and gross fixed capital formation made less negative contributions than in previous quarters, while the contribution of government consumption was positive. 2 GDP was up 0.3% relative to Q2 2013 (seasonally adjusted) and up 0.6% year-on-year. 3 According to OECD expectations, the unemployment rate will hover above 12% until mid-2015. Figure 2: Yields on ten-year government bonds Portugal - Italia Slovakia -Germany -----Ireland - Slovenia ---Spain Austria It ^^ ij ^^ Source: Bloomberg. Based on the reduction of price pressures, the ECB decided to cut its key interest rate in November. After May's reduction, the ECB cut the key interest rate by 0.25 percentage points to 0.25% in November and the interest rate on the marginal lending facility to 0.75%. This measure is aimed at the recovery of the economy in the euro area, and the ECB has confirmed that key interest rates will remain at low levels for an extended period of time. In the medium term the lower interest rate could contribute to the continuation of low interest rates on the interbank and monetary markets. Other key interest rates of the main central banks remained unchanged in November (FED 0.0-0.25%, BoE 0.5%, BoJ 0.0-0.1%).The 3-month EURIBOR rate remained similar to that in October (0.223%); the 3-month USD and CHF LIBOR rates also remained roughly unchanged (0.24% and 0.02%, respectively). Figure 3: ECB interest rates -Key interest rate -----Margin deposit 5.5 5.0 4.5 4.0 3.5 3.0 2.0 1.5 1.0 0.5 0.0 The euro depreciated against the US dollar in November. The value of the euro declined by 1.0% to USD 1.349 per euro mainly due to the change in the key interest rate of the ECB. The euro also depreciated against the British pound (by 1.1% to GBP 0.838 per euro), while it rose against the Japanese yen (by 1.2% to JPY 134.97 per euro). The euro remained unchanged against the Swiss franc (CHF 1.232 per euro). Oil prices fell again in November. The average price of Brent crude dropped by 1.2% to USD 107.79 per barrel, while the price in euros remained nearly unchanged (EUR 79.93 per barrel). Oil prices in dollars are down 1.2% year-on-year (prices in euros down 6.0%). Since October, oil prices have been dropping under the impact of weak seasonal demand, growth in inventories and a decline in certain geopolitical risks. Non-energy commodity prices otherwise rose slightly in October after four months of decline, but in the coming months commodity prices are expected to decline further, according to the IMF data. Figure 4: Prices of Brent crude oil and the USD/EUR exchange rate -Price in EUR (left axis) -Price in USD (left axis) -USD/EUR exchange rate (right axis) I 18 1.4 1.2 , 08 20 0.6 oocoCrto^CDO^-^rNrNr^nm Source: ECB, EIA; calculations by IMAD. Economic developments in Slovenia In the third quarter real merchandise exports increased (2.0%) due to stronger growth in exports to the EU, while exports outside the EU declined again (seasonally adjusted).4 As a result of the recovery of economic activity in the EU, nominal merchandise exports to the EU rose for the second consecutive quarter, in contrast to exports to Source: ECB, Euribor-EBF; calculations by IMAD. 4 According to the National Accounts Statistics. With Croatia's accession to the EU, the status of Croatia in the statistical monitoring of merchandise trade between Slovenia and Croatia changed.To ensure data comparability, we take into account (as does SURS) that Croatia has been an EU Member State since January 2012, even though it was not yet in the EU at that time. 0 1.6 1.0 Table 2: Selected monthly indicators of economic activity in Slovenia in % 2012 IX 13/ VIII 13 IX 13/ IX 12 I-IX 13/ I-IX 12 Exports1 1.9 18.8 6.5 2.8 -goods 0.8 24.2 4.4 1.8 -services 6.7 3.1 14.8 7.1 Imports1 -2.6 15.8 5.3 -2.5 -goods -3.0 19.9 4.4 -2.9 -services -0.1 -3.6 11.3 -0.2 Industrial production -1.1 -0.42 -0.43 -1.53 -manufacturing -2.3 1.52 -0.83 -2.23 Construction -value of construction put in place -16.8 6.22 -7.93 -11.83 Real turnover in retail trade -2.3 -3.22 -4.83 -4.13 Nominal turnover in market services (without trade) -2.8 1.02 3.43 -0.83 Sources: BS, Eurostat, SURS; calculations by IMAD. Notes: 'balance of payments statistics, 2seasonally adjusted, 3working-day adjusted data. the countries outside the EU, which fell for the second quarter in a row. Broken down by products, total quarterly growth is estimated5 to be a consequence of stronger growth in exports of primary goods (re-exports of oil and oil products in particular) and a slight increase in exports of vehicles and metals. Exports of chemical products, including medical and pharmaceutical products, which have made a significant contribution to the recovery of exports thus far, also ceased to grow, for the first time in a long period. In the first nine months real merchandise exports were up (1.5%, orig.) relative to the same period last year. Real merchandise Imports rose slightly in the third quarter (0.5%), in our estimation mainly due to growth in imports of consumer goods (seasonally adjusted).6 Despite a further decline in household consumption, imports of consumer goods increased, according to our estimate, mainly on account of increased imports of passenger cars.7 After they stopped falling in the first quarter as a result of imports of investment equipment for an energy facility, imports of investment goods dropped again, according Figure 6: Nominal merchandise imports by end-use product group -Imports of investment goods* -----Investment in machinery and equipment -Imports of consumer goods* -----Household consumption -Imports of intermediate goods* Manufacturing production a a a a a a Source: SURS; calculations by IMAD. Note: The Q3 13 data are the July and August average. Figure 5: Nominal merchandise exports - regional -Total -EU -non-EU a a a a a a Source: SURS; calculations by IMAD. 5 Detailed data on the structure of merchandise imports according to the external trade statistics are available only until August. Figure 7:Trade in services - nominal -Exports -Imports 1,400 1,300 1,200 1,100 1,000 900 a a a a Source: BS; calcualtions by IMAD. 6 According to the National Accounts Statistics. Detailed data on the structure of imports according to the external trade statistics are available only through August. 7 The number of car registrations by legal persons, which has otherwise been rising since the beginning of the year, has increased significantly again in the third quarter. Box 1: Gross domestic product, Q3 2013 Amid positive impulses from the international environment and tensions in the domestic environment, GDP remained unchanged (seasonally adjusted) in the third quarter, recording a smaller year-on-year decline (-0.6%) than in previous quarters. Amid the recovery in main trading partners in the EU, there was a substantial increase in exports (seasonally adjusted), which also saw higher growth year-on-year (4.8%). Imports also rose slightly (seasonally adjusted) and recorded the first year-on-year increase since Q1 2012 (2.6%). The contribution of net exports to the year-on-year change in GDP remained the same as in the second quarter (1.9 percentage points). In contrast, the situation in the domestic environment tightened further, with household and government final consumption and investment activity falling again (seasonally adjusted) and recording a deeper year-on-year drop. A sharper decline in household consumption than in the second quarter, when purchases of durable goods increased before July's increase in VAT, was in line with expectations. After the rise in VAT, durable goods purchases fell again amid a continued decline in consumption of other goods. The falling of government consumption also intensified in the last two quarters. In the third quarter gross fixed capital formation dropped again after a more pronounced decline in investment in machinery and equipment and a further decline in construction investment (seasonally adjusted). The smaller year-on-year decline in GDP is mainly due to the contribution of changes in inventories, which was positive for the first time in two years (0.6 percentage points). The decline in value added was similar to that in the previous quarter (-0.4%, seasonally adjusted). A significant decline in value added relative to the previous quarter was recorded in market services, particularly in trade and in professional, scientific and technical activities and in other services. Value added in public services continued to fall, while the declines in value added in manufacturing and construction eased. The year-on-year fall in total value added (-1.3%) was similar to that in the second quarter. Figure 8: GDP in Slovenia and its main trading partners —<—Slovenia -Germany ---------France ----Italy -Austria ---------Croatia Figure 9: GDP expenditure structure, Slovenia ■ Private consumption I Gross fixed capital formation I Exports of goods and services - Real GDP growth (right axis) ^■Government consumption fslli^Ch. in inventories and valuables Imports of goods and services 8 6 4 2 0 -2 CL -4 Q 4 -8 -10 ooooooooooo Source: Eurostat; calcualtions by IMAD. .....-i"..........fr-" ^-■■i......i.......... 1 1 1 1 1 1 1 1 1 1 1 1 J ... J . t. .1. J .... 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 : 1 1 1 1 1 1 1 1 1 1 1 1 a a Source: SURS. to our estimate, due to a further decline in investment in machinery. Given the fall in manufacturing production, imports of intermediate goods also declined somewhat in our estimation. In the first nine months real merchandise imports were at roughly the same level (0.1 %, orig.) as in the same period last year. Exports and imports of services expanded in nominal terms in Q3 2013 (seasonally adjusted).8 After dropping in the 8 According to the balance of payments statistics. 9 When adjusting data for seasonal effects, we placed communication, construction, financial, computer and information activities, personal service activities, arts, entertainment and recreation activities, government services, insurances and licences, patents and copyrights into the group of other services. Together, they account for just over a tenth of services exports and almost a third of services imports. second quarter, exports of services continued to increase in nominal terms in the third quarter (3.2%). Exports of other business services rose in particular, reaching the highest monthly value thus far in September. Exports of travel increased as a result of a higher number of foreign tourist overnight stays. Exports of other services also recorded growth.9 Nominal growth in services imports (2.7%) was a result of higher imports of other services (construction services in particular) and slightly higher imports of transport services. In the first nine months nominal exports of services were up 7.1%, according to original data, while imports were similar (0.2%) to those in the same period last year. 20 15 si 10 1= 5 0 -5 o It -10 -15 O t-J -20 Figure 10: Recovery of real goods exports (statistics of national accounts) Box 2: Impact of regional structure on exports of goods Slovenia continues to experience a slower recovery of goods exports^ than some new EU Member States. After a substantial decline at the beginning of the crisis, in most EU Member States real merchandise exports hit the bottom in the second quarter of 2009. In the four years to Q2 2013, real exports of goods in the EU rose by an average of 28.4%. The recovery of Slovenian exports was similar (28.1%), but according to the available data, Slovenia recorded the slowest recovery in real exports of goods of all countries that have joined the EU since 2004, while among the old Member States exports recovered faster in Spain, Germany and Portugal. The relatively slower recovery of goods exports in Slovenia compared with the new EU Member States indicates a loss in export competitiveness, which is also corroborated by a substantial decline in Slovenia's market share in global merchandise exports.2 In 2008-2012 Slovenia lost 23.7% of its share on the global market of goods,3 and 6.4% and 5.8% of its market shares in the EU and the countries of former Yugoslavia, respectively. The crisis affected the global market share of the entire EU, but Slovenia was in the group of countries with the largest declines (in 6'h place), particularly in 2008, 2010 and again in 2012, after the decline nearly came to a halt in 2011. The figures for the first quarter of 2013 are slightly more encouraging, indicating an increase (by 1.9%, year-on-year) in Slovenia's market share on the global market of goods. Three fifths of the decline in Slovenia's market share in the period until 2012 was attributable to various price and non-price factors, such as uncompetitive prices, insufficient quality, failing to adapt to the local taste, etc. One fifth was accounted for by the production structure and another one by the regional structure of merchandise exports. Source: Eurostat; calculations by IMAD. Note: Data for BE, IE, EL, HU and PL not available. The regional structure is one of the main reasons for the relatively slower recovery of Slovenian goods exports, primarily due to a slower recovery of exports to the countries of the former Yugoslavia, which account for a relatively larger share in Slovenia's Figure 11: Change of the market share in global goods exports -Slovenia -EU -Czech R. Slovakia -Hungary -----Poland 2007 2008 2009 2010 2011 Source: UN COMTRADE; calculations by IMAD. Figure 12: Movement of nominal extra-EU merchandise exports -SI (31,2) -CZ (19,0) ■HU (24,2) SI excl. the former YU (17.4) SK (16,1) PL (24,3) Source: Eurostat; calculations by IMAD. Note: Figure in brackets is share of extra-EU exports in total merchandise exports. 1 Real merchandise exports according to the statistics of national accounts and seasonally adjusted data. 2 For more on the movement of export competitiveness see IMAD Development Report 2013, pp. 26-35. 3 Slovenia's market share of goods and services on the global market fell by 19.9%, according to the European Commission, AMR 2014. 2012 total exports of goods.4 Given the weak recovery of EU economies, in most EU countries exports to the EU recover much more slowly than exports outside the EU. The same goes for Slovenia, but Slovenia recorded a much smaller increase in extra-EU exports than other countries. This can be explained by a slower recovery of exports to the countries of the former Yugoslavia, which account for a much larger share in Slovenia's exports (last year 13.8%) than in the exports of other new EU Member States.5 The recovery of Slovenia's extra-EU exports of goods with regard to some new EU Member States is relatively faster (if the countries of the former Yugoslavia are excluded). In the second quarter of 2013 nominal goods exports to the countries of the former Yugoslavia were only 16.5% higher than in the second quarter of 2009, in contrast to the total nominal exports of goods, which were up 42.5%. The key reason for the slow recovery of exports to these countries is the relatively slower recovery of their economies, which holds true for Croatia, in particular, and, to a lesser extent, Serbia and Bosnia and Herzegovina.6 The slow recovery of exports to these markets is also impacted by a deterioration of Slovenia's export competitiveness, which is indicated by a decline in Slovenia's market share in these countries in 2008-2012, although it was smaller than the decline in the market share in global goods exports. 4 A comparison of Eurostat's original data on nominal exports of goods. Croatia is included in the group of the countries of the former Yugoslavia, as it became a Member State of the EU only in July 2013. 5 Last year the share of exports to the countries of the former Yugoslavia in Hungary totalled 3.9%; in Slovakia 1.0%; in the Czech Republic 0.8%; and in Poland 0.7%. 6 Last year GDP in Croatia was 10.9% below the 2008 level, in Serbia 2.7%, in Bosnia and Herzegovina 1.7%, while GDP in the EU overall was 1.2% lower than in 2008. Despite September's growth, production volume in manufacturing fell somewhat again in the third quarter. The decline was mainly due to production volume in industries of higher technology intensity, which continued to drop in the third quarter. In low-technology industries, production remained almost unchanged, much as in previous quarters, while production in medium-low-technology industries rose again, seasonally adjusted. Having declined further, manufacturing output was lower year-on-year again in the third quarter (-2.0%, working-day adjusted). It remained lower in low-technology industries (-3.4%), with the largest declines still recorded in the textile, wood-processing and furniture industries. Having dropped since the beginning of the year, production volume was down year-on-year in industries of higher technology intensity (-3.9%). It remained higher than a year earlier only in the chemical and pharmaceutical industry, which recorded a significant moderation in growth in the third quarter.10 Given the recovery since the end of last year, production in medium-low-technology industries rose year-on-year (4.1%). The largest year-on-year increase in activity was recorded in the sector of repair and installation of machinery and equipment. In the third quarter the lag behind the production level in 2008 increased and remained among the largest in the EU. Production volume in the EU rose (seasonally adjusted), after shrinking at the end of last year. In the third quarter it was similar to the same period last year and around 7.0 percentage points lower than in 2008. The lag behind the 2008 production level in Slovenia is still much larger than, on average, in the EU (by around 15.0 percentage points), Figure 13: Production volume in manufacturing industries according to technology intensity —•— Low-technology industries -Medium-low-technology industries -----Medium-high and high-technology industries -Total manufacturing Figure 14: Production volume in manufacturing in the EU countries in Q3 2013 130 I i i i i i i :: i i i i i i i i i i : i i i i i i i i i iS 100 a a a a Source: SURS; calculations by IMAD. Source: Eurostat; calculations by IMAD. Note: * Data for Q3 2013 for two months. In the third quarter production volume in the chemical and pharmaceutical industry was 1.5% higher year-on-year; in the first half of the year a tenth higher, on average. Weak Q3 growth was mainly attributable to August's decline, which was primarily a result of strong production activity in August 2012. while most new Member States have already reached, or exceeded, their outputs of 2008. Among Slovenia's main partners in the euro area, the pre-crisis levels have already been reached by Austria and Germany, while output levels in France and Italy, in particular, are lower than in 2008. According to business trends data, the prospects for the end of the year are improving. Despite deterioration in the middle of the year, most companies surveyed expect that demand (export demand11 in particular) will strengthen in the remaining part the year. Sales revenues otherwise declined slightly in Q3 (-0.7%, seasonally adjusted) after the increase in the first half of the year, and remained down year-on-year (-0.8%) both on the domestic and foreign markets.12 Amid the expected increase in demand, most companies expect production to increase, though most of them are still planning to cut jobs. In the first nine months 3.3% fewer people worked in the manufacturing sector than in the same period last year. Figure 15: Expectation indicators according to the business trend data for manufacturing -Expected employment-Expected prices -----Expected production -Expected total demand -----Expected exports 40 Figure 16: Value of construction put in place Source: SURS; calculations by IMAD. Construction activity increased again in the third quarter. The value of construction put in place rose by 7.0% in Q3 (seasonally adjusted). Despite the second consecutive quarterly growth, it remained lower than in the same period last year (-4.2%), which is much less than in previous quarters. Civil engineering strengthened at the quarterly level, reaching the level recorded a year earlier. The construction of buildings was at a similar level as in Q2 and remained much lower than a year before. 11 Data on business trends show a decline in the share of enterprises that cited insufficient foreign demand as a limiting factor in the last quarter, while the share of those that cited insufficient domestic demand remained similar to that in Q3. 12 In Q3 sales revenues outside the euro area were otherwise smaller year- on-year for the first time in 2013 (-3.7%; 4.0% in the first half of the year), while sales revenues in the euro area were up relative to the 100 80 60 1Ž Construction Residential buildings Civil-engineering works Non-residential buildings O O O O O O Source: SURS; calculations by IMAD. At the end of Q3 the stock of contracts in the construction sector was up 33.1%year-on-year. The largest increase was recorded in civil engineering, where the stock of contracts was more than half higher than in the same period last year - in our estimation these contracts are mainly related to the construction of municipal infrastructure co-financed with EU funds. The indicator of the stock of contracts in this segment is even higher than before the crisis. The stock of contracts in the construction of non-residential buildings is at roughly the same level as a year earlier, which is still half less than before the beginning of the crisis. The stock of contracts in residential construction has declined substantially in the recent period, reaching less than a fifth of the pre-crisis value. Figure 17: Total floor area planned by building permits issued 2,800,000 2,400,000 2,000,000 1,600,000 1,200,000 400,000 Non-residential buildings Residential buildings a a Source: SURS. 40 20 0 0 By issuing building permits, construction of 771 dwellings was planned in the third quarter of 2013, which is 1.8% fewer than in the third quarter of 2012. The number of building permits issued for dwellings has increased slightly in 2013, after dropping by 70.0% in 2007-2012. In the last four quarters the number of dwellings planned by the issue of building permits increased by 9.2% as a result of a higher number of dwellings in one-dwelling buildings (14.3%). The number of building permits for multi-dwelling houses dropped further (-6.8%), to less than a fifth of that in 2008. The construction confidence indicator remained at a relatively favourable level in November. The upward trend of the confidence indicator, which had reached its low in 2010 and was rising slightly in 2011 and 2012, has accelerated this year. The value of the confidence indicator increased markedly in the summer. In August it reached the highest value since October 2008, and then dropped slightly in the following months. Over the last year the indicator value has increased most notably in civil engineering, but it has also picked up in the other two construction segments (the construction of buildings and specialised construction activities). Turnover in all trade sectors declined in the third quarter (seasonally adjusted) and was lower year-on-year, except in the sale of motor vehicles. After the increase in the second quarter, particularly in the sale of durable and semi-durable goods before the VAT increase, turnover in retail trade declined in the third quarter and reached the lowest level since 2008. After growth in the previous quarter, turnover also dropped in the sale and repair of motor vehicles, where it had been strengthening again13 since the relatively substantial fall in July and was in September at a similar level as in May 2013. Turnover in wholesale trade declined as well. At the end of the quarter Figure 18: Turnover in trade sectors -Retail trade, real ----- of which automotive fuels, real -----Sale, repair of motor vehicles, real -Wholesale trade, nom. 105 O O O O O Source: SURS; calculations by IMAD. it was at roughly the same level as mid-2011. Turnover in wholesale and retail trade in the third quarter was lower, while turnover in the sale of motor vehicles was higher than in the same period last year. Within retail trade, the largest decline in turnover was recorded in the sale of non-food products. After the interruption in the second quarter, when turnover in the sale of durable and semi-durable goods in specialised stores selling furniture, construction material, computer and telecommunication equipment, books, sports equipment and toys surged in anticipation of higher VAT, turnover in the sale of non-food products continued to drop and reached the lowest level since 2008. Given the adverse situation on the labour market and uncertainty about the future, negative movements also continued in the sale of food, beverages and tobacco products as a result of continued consumer caution, changes in buying behaviour14 and consumers turning to discount stores. Turnover also declined in the sale of automotive fuels, which lagged most notably behind last year's level due to a lower quantity of automotive fuels sold. Figure 19: Turnover in retail trade of non-food products -Sale of medical and cosmetic products -Sale of textiles, clothing and footwear -----Sale of furniture, construction material -----Sale of household appliances, audio and video recordings -----Sale of computer, telecom. equipment, books and sports equipment 110 100 80 70 50 \ \ y__________ \ N»^ / \ _ \ V '' x -i...........................i- a a a a a a Source: SURS; calculations by IMAD. Nominal turnover in market services (other than trade)15 increased for the third consecutive quarter (seasonally adjusted) but remained down year-on-year (-2.1%). The largest increase (1.6%, seasonally adjusted) was recorded in transportation and storage. Turnover in accommodation and food service activities also rose again. Turnover in administrative and support service activities expanded slightly as well, but within these, turnover declined in employment activities, which had previously experienced rapid g rowth.Turnover i n professionaland technical services recorded a substantial decline (-2.9%) owing to lower turnover in engineering and legal-accounting services. Despite growing turnover in telecommunications, also 13 As a result of increased sales of new cars to legal entities. 14 Switching from name brands to lower-priced store brands, purchasing products on sale and promotions, shopping in several stores.. 15 Activities from H to N (SCA 2008) subject to the Council Regulation (EC) No. 1165/98 concerning short-term statistics. 90 ^ 60 Box 3: Road and rail freight transport in Q2 2013 Freight transport declined in the second quarter due to a smaller volume of international road freight transport. Road freight transport is on a downward trend while rail transport has been stagnating for a year and a half (seasonally adjusted). International road freight transport dropped after Q1 growth, and was down 4.3% year-on-year. The year-on-year fall was largely due to lower merchandise trade with Germany,1 with domestic carriers' transport between Slovenia and Germany dropping by a third. Stronger growth in national transport was mainly a result of increased construction activity.2 With favourable movements in construction and increased wood purchases,3 the volume of national transport rose by 18.0% year-on-year. Rail freight transport has been stagnating for one and a half years (except in the last quarter of 2012), and remains slightly below the pre-crisis year 2008. 1 In Q2 goods exports to Germany were down 2.2% year-on-year. 2 The value of construction put in place rose by 4.4 % in Q2 (seasonally adjusted). Transport of ores, rocks and non-metallic mineral products, which accounts for around a third of all national transport, was up by around a tenth in year-on-year terms. 3 Wood purchase was up 13.0% year-on-year. Transport of wood and agricultural products accounts for over a tenth of national freight transport. Figure 20: Road and rail freight transport -----Road, international (left axis) -Rail (right axis) -Road, national (right axis) 3,800 3,700 3,600 3,500 3,400 3,300 E 3,200 3,100 3,000 - 2,900 2,800 1,200 O O O O Source: SURS; calcu lations by IMAD. due to higher prices of services,17 turnover in information-communication services dropped somewhat. The largest provider of telecommunication services18 once again recorded much lower turnover growth than other providers, which may be a sign of a larger competition in the sector. Figure 21: Nominal turnover in market services -Total -Transportation and storage (H) -----Communication (J) -----Professional-technical (M) -Admnistrative and support service (N) -----Accommodation and food service (I) a a a a Source: SURS; calculations by IMAD. 16 After more than two and a half years of decline, prices of telephone services and products recorded a substantial increase in Q3 (by 3.0%, seasonally adjusted; nominal growth in turnover in telecommunications was 0.6%). 17 According to the quarterly accounts of Telekom Slovenije, in Q3 the company increased sales revenues by 0.9% relative to Q2, while sales revenues of the whole sector increased by 3.8% (not seasonally adjusted). After the improvement early this year, business confidence remains almost unchanged in the second half of the year. In November confidence in manufacturing remained roughly the same as in the middle of the year. It improved slightly in the construction sector, service activities and among consumers, where it has declined somewhat in recent months. After the improvement due to the VAT increase in the middle of this year, confidence is also falling in retail trade. Figure 22: Business trends -Economic sentiment .....Retail trade -Construction - Manufacturing - Service activities Consumers 40 30 20 10 o r^ -10 is -20 > -30 -40 -50 -60 (3 -70 : i —J..... 1 1 ............r............f............ .......i............i........ k // \ » / ' r» < * t ' i \ , 1 I,'Y/' v, y '' ' ............ VIT Wr ' iK/' : ... / ........... Source: SURS; calculations by IMAD. Labour market Labour market conditions have stabilised in recent months but remain tight. The number of employed persons,18 which was still falling at the beginning of the year, has been almost unchanged in recent months (seasonally adjusted), mainly on account of increased construction activity. The number of employed persons in the first nine months otherwise remains 2.7% lower than in the same period last year. Table 3: Indicators of labour market trends Figure 23: Employed persons according to the statistical register and registered unemployed persons in % 2012 IX 13/ VIII 13 IX 13/ IX 12 I-IX 13/ I-IX 12 Labour force -1.5 0.0 -0.4 -1.0 Persons in formal employment -1.7 0.0" -1.6 -2.5 Employed in enterprises and organisations and by those self-employed -1.6 0.3 -2.1 -3.0 Registered unemployed -0.5 -0.2" 8.8 9.6 Average nominal gross wage 0.1 0.0" 0.4 -0.4 - private sector 0.5 0.2" 1.5 0.3 - public sector -0.9 -0.1" -1.1 -1.5 -of which general government -2.2 0.1" -1.7 -3.0 2012 IX 12 VIII 13 IX 13 Rate of registered unemployment (in %), seasonally adjusted 12.0 12.0 13.1 13.1 Average nominal gross wage (in EUR) 1,525.47 1,489.00 1,506.88 1,495.28 Private sector (in EUR) 1,395.84 1,354.74 1,391.14 1,375.60 Public sector (in EUR) 1,762.88 1,734.51 1,720.16 1,715.40 -of which general government (in EUR) 1,761.15 1,734.23 1,694.94 1,705.40 Sources: ESS. SURS; calculations by IMAD. Note: "seasonally adjusted. Table 4: Employment flows I-X 11 I-X 12 I-X 13 INFLOW OF UNEMPLOYED - TOTAL 82.087 83.673 88.251 Jobseekers who lost work 12.297 13.588 15.665 bankruptcy of the company 66.810 69.870 72.413 business reasons or compulsory settlement 6.862 3.686 3.169 termination of fixed-term contracts 12.900 14.967 14.540 other reasons 36.168 39.826 43.822 First-time jobseekers 10.880 11.391 10.882 Other (transitions between records) 2.980 215 173 OUTFLOW OF UNEMPLOYED - TOTAL 81.203 85.541 87.591 Unemployed who found work 52.501 49.809 56.350 public works 1.293 3.670 5.285 self-employment 4.543 3.440 4.264 Transitions into inactivity 11.932 12.354 11.229 retirement 7.733 8.535 7.130 Breaches of regulations 10.510 16.254 12.088 Other (transfer to other registers, other) 6.260 7.124 7.924 - Employed according to the statistical register (left axis) - Registered unemployed (right axis) 800 ro 780 760 cc i|740 1^720 ,..........I... ...........f..........f..........' ! ____j... ______J__________ ! '..........r"' '..........r"" !...........T 240 220 '■TD 200 180 ii lu 160 140 ■ "D tu 120 Jä £P E C3 C3 Source: SURS. ESS; calculations by IMAD. The number of registered unemployed has remained unchanged in recent months after the sharp increase in the first half of the year. A total of 118,721 persons were unemployed in October, i.e. 4,052 persons more than in September (original data), and 7.1% more than in October 2012. According to seasonally adjusted data, the number of unemployed persons dropped slightly (-0.3%). Inflows into unemployment have been falling since June, particularly the inflows from the sectors of construction, manufacturing and market services. In the first ten months unemployment averaged 119,460 persons, 9.3% more than in the same period last year. The inflows into unemployment increased (5.5%) due to a larger number of first-time jobseekers (15.3%) and persons who registered as unemployed because of the Figure 24: Persons in formal employment by activity ■ Q3 2012 Q4 2012 HOI 2013 «02 2013 »03 2013 Manufacturing Construction 18 According to SRE; these are employed and self-employed persons excluding self-employed farmers. Market Public services services Source: SURS; calculations by IMAD. 80 60 40 Table 5: Persons in formal employment by activity Number in '000 Change in Number 2012 IX 12 VIII 13 IX 13 2012/ 2011 IX 13/ VIII 13 IX 13/ IX 12 I-IX 13/ I-IX 12 Manufacturing 182.9 182.1 177.3 177.6 -1,919 311 -4,556 -6,103 Construction 59.8 59.6 55.5 56.0 -8,047 505 -3,546 -6,645 Market services 338.4 337.0 332.8 333.3 -3,805 514 -3,716 -6,449 -of which: Wholesale and retail trade, repair of motor vehicles and motorcycles 107.8 107.1 103.5 103.4 -1,848 -152 -3,699 -3,845 Public services 171.6 171.5 169.2 170.1 1,438 900 -1,405 -1,809 Public administration and defence, compulsory social security 50.7 50.7 49.2 48.9 -650 -300 -1,815 -1,715 Education 65.5 65.3 64.4 65.4 778 1.039 147 -194 Human health and social work activities 55.4 55.6 55.7 55.8 1,311 161 263 100 Other 57.3 58.1 58.4 58.5 -1,632 49 429 1,086 Source: SURS; calculations by IMAD. Table 6: Wages by activity Gross wage per employee, in EUR Change, in % 2012 IX 2013 2012/ 2011 IX 13/ VIII 13 IX 13/ IX 12 I-IX 13/ I-IX 12 Private sector activities (A-N; R-S) 1,463.64 1,440.20 0.8 -1.3 1.1 0.5 Industry (B-E) 1,444.29 1,438.37 2.5 -2.5 3.2 2.5 - of which manufacturing 1,397.25 1,397.20 2.5 -2.4 3.7 2.5 Construction 1,205.65 1,183.54 -2.5 -0.7 0.9 -1.5 Traditional services (G-I) 1,354.04 1,323.20 0.3 -0.9 -0.5 -0.2 Other market services (J-N;R-S) 1,713.36 1,666.82 -0.3 -0.2 -0.1 -1.4 Public service activities (O-Q) 1,710.91 1,659.12 -2.2 0.5 -1.5 -2.7 - Public administration and defence, compulsory social security 1,752.03 1,718.71 -1.8 0.0 -0.6 -1.7 - Education 1,676.80 1,622.20 -3.3 2.4 -1.3 -3.9 - Human health and social work activities 1,712.37 1,647.54 -1.3 -1.3 -2.4 -2.2 Source: SURS; calculations by IMAD. termination of fixed-term employment contracts (10.0%). The higher outflows from unemployment (2.4%) were mainly a result of employment (13.1%), particularly as a result of a greater involvement of the government in the implementation of active employment-policy schemes that mean employment (public works, subsidies for self-employment). The data from the labour force survey also indicate a decline in the number of unemployed persons in the third quarter, seasonally adjusted. The average gross earnings per employee rose slightly in the third quarter (0.2%, seasonally adjusted) and were at roughly the same level as a year earlier. In the private sector,19 where they had been almost unchanged20 in the last year and a half, they increased slightly (0.3%); in the public sector they were by the same percentage lower. The average gross earnings in public corporations were up 0.3%, while the average gross earnings in the Figure 25: Average gross earnings per employee -Total ■ Private sector - Public sector li 19 As of June 2012, we only comment on data on earnings in the private sector and public sector (within the latter, particularly in the general government), and only exceptionally on earnings in activities of the private sector and in public service activities; for more see SEM 06/12, Selected Topics - Monitoring the movements of wages and wage earners in the public and private sector. 20 Before that (in 2010 and 2011), the growth rates were impacted particularly by the increase in the minimum wage and changes in employment structure. ---- -of which, general government sector ..........of which, public corporations 1,900 1,800 1,700 ^^ 1,600 c O 1,500 (U 1,400 ^^^ 1,300 1,200 SS ^ a a a a Source: SURS; calculations by IMAD. government sector, which have been falling since the adoption of the ZUJF in the middle of last year, declined again (-0.6%), primarily due to the additional austerity measures enforced in June. In the first nine months the average gross earnings in the government sector were thus 3.0% lower than in the same period last year. The decline in the public sector in this period was half smaller due to above-average growth in the average earnings in public corporations (1.8%), while the average earnings in the private sector remained similar to last year. Prices Consumer prices fell in November, according to the provisional data by SURS, and year-on-year inflation remained low. November's price movements were consistent with expectations, and monthly deflation was mainly marked by lower prices of liquid fuels (-0.1 percentage points) and unprocessed food (-0.1 percentage points). Year-on-year inflation remained at the previous month's level in Slovenia (1.3%), while it rose slightly in the euro area (0.9%), according to Eurostat's flash estimate. Figure 26: Headline and core inflation in Slovenia and in the euro area Figure 27: Breakdown of year-on-year inflation Slovenia HICP Slovenia HICP -core inflation Euro area HICP Euro area HICP -core inflation coo^o^oo^^rNrNmm Source: SURS; calculations by IMAD. Figure 28: Movement of unprocessed food prices ^■Vegetables, fresh and processed Fruits, fresh and processed ^HFish ^HMeat -Unprocessed food (left axis) 2 0 ^^ -2 -4 Source: Eurostat. Source: SURS; calculations by IMAD. According to detailed data until October, the decline in year-on-year inflation in October21 (by 0.1 percentage points to 1.3%) mainly reflected the year-on-year fall in liquid fuel prices and prices of food. Liquid fuel prices were down in October (-5.7%) relative to the same month last year primarily on account of the movement of euro prices of oil (-7.0%). The decline in inflation was also attributable to food prices, whose growth dropped year-on-year in the last three months (by 2 percentage points to 2.6%). This year's food price dynamics are mainly marked by prices of unprocessed food, whose year-on-year growth fell to 3.3% in October after the high values in the summer months (around 9%). In October year-on-year inflation also declined in the euro 21 Detailed data on November's inflation will be released later and commented upon in the next SEM. area (-0.4 percentage points) and reached a four-year low (0.7%). The decline in year-on-year growth was, much as in the domestic environment, marked by lower prices of energy (-1.7%) and lower growth in prices of (particularly unprocessed) food (down 1.5 percentage points to 1.4%). Year-on-year growth declined across the euro area overall. As a result of such movements of food and oil prices, headline inflation and core inflation (which is impacted by weak economic activity) are similar. Industrial producer prices on the domestic and foreign markets were down year-on-year in October. Growth in industrial producer prices on the domestic market has been falling since the beginning of 2011. The year-on-year decline in October was primarily a result of lower prices of metals and metal products and a further moderation in prices of food products. The year-on-year decline in prices 8 7 6 5 4 3 2 ^^ 1 0 2 8 12 10 8 6 4 6 Table 7: Breakdown of the HICP into sub-groups - October 2013 Slovenia Euro area Cum. % Weight % Contribution in p.p. Cum. % Weight % Contribution in p.p. Total HICP 1.6 100.0 1.6 0.7 100.0 0.7 Goods 1.1 65.7 0.7 0.8 57.7 0.5 Processed food, alcohol and tobacco 2.2 16.1 0.4 1.7 12.0 0.2 Non-processed food 2.6 7.4 0.2 0.1 7.3 0.0 Non-energy industrial goods 0.5 27.9 0.1 0.7 27.4 0.2 Durables -0.8 9.7 -0.1 -0.7 8.8 -0.1 Non-durables 0.7 8.8 0.1 0.9 8.0 0.1 Semi-durables 3.1 9.4 0.3 3.0 10.5 0.3 Energy 1.3 14.4 0.2 0.4 11.0 0.0 Electricity for households 12.6 2.7 0.3 4.7 2.6 0.1 Natural gas 0.3 1.1 0.0 -0.8 1.8 0.0 Liquid fuels for heating -2.1 1.5 0.0 -2.7 0.9 0.0 Solid fuels 2.5 0.9 0.0 1.7 0.1 0.0 District heating -1.9 0.9 0.0 0.5 0.6 0.0 Fuels and lubricants -1.8 7.4 -0.1 -1.2 5.0 -0.1 Services 2.3 34.3 0.8 0.6 42.3 0.3 Services - dwellings 5.9 3.0 0.2 1.5 10.3 0.2 Services - transport 4.2 5.8 0.2 1.2 7.2 0.1 Services - communications 1.8 3.5 0.1 -3.4 3.1 -0.1 Services - recreation, repairs, personal care 1.6 13.9 0.2 0.3 14.7 0.0 Services - other services 1.3 8.1 0.1 0.3 7.1 0.0 HICP excluding energy and non-processed food 1.7 78.2 1.3 0.8 81.7 0.7 Source: Eurostat; calculations by IMAD. Note: ECB classification Figure 29: Movement of domestic industrial producer prices on the domestic and foreign markets -PPI (domestic market) -----Mfr.of basic metals,fabric.metal prod.,exc. mach.,equip. (domestic) ---Mfr. of food products; beverages; tobacco products (domestic) -PPI (foreign market) 20 16 12 8 !Z S 4 O ^ 0 -4 -8 -12 -16 ........f" 1............. ............. \ \ \ ........... 1 1 : ^ 1 ,' ~>\i J I .............: ^ 1 1 j i .....r...........; 1 1 !"■.......r........... to the year-on-year decline came from lower prices in the manufacture of metals and metal products (-7.2%). Prices of food products also declined again (-0.2%). In September the price competitiveness of the economy continued to deteriorate year-on-year. The year-on-year Figure 30: Real effective exchange rates of euro area members deflated by HICP, January - September 2013 ■ NEER 20 ■HICP »REER HICP coc^o^oo^^rNrNmm tDrDtDrD^T-^T-^r-^r-C^^ C^^ C^^ C^^ C^^ Source: SURS. on foreign markets remained at the previous month's level (-0.9%) and was mainly a consequence of lower prices in the manufacture of metals and metal products (-4.2%). Import prices fell again in October and were down 1.5% relative to the same period lastyear. The largest contribution ^ m < Q Source: ECB; calculations by IMAD. increase in the real effective exchange rate measured by the relative HICP was much smaller than in the previous two months (by 1.3% in July and by 2.7% in August), which was a result of the monthly decline in the exchange rate of the euro and relative prices,22 as well as the petering-out of the base effect related to price rises in certain services in September 2012.23 In terms of year-on-year loss in price competitiveness, Slovenia was around the middle of euro area countries in September and in the first nine months of the year. Owing to the structure of its external trade, the strengthening of the nominal effective exchange rate in Slovenia was among the smallest,24 and growth in relative prices (which was also due to one-off factors) among the largest in the euro area. Balance of payments The current account of the balance of payments, which was almost balanced in the first three years of the economic and financial crisis, has been in surplus since the beginning of last year. The year-on-year widening of the surplus in current transactions in the third quarter was again largely due to a larger surplus in external trade. The deficit in factor income was lower, while the deficit in current transfers remained roughly unchanged relative to the same period last year. In the first nine months the surplus in current transactions climbed to EUR 1,866.8 m, compared with EUR 677.1 m in the same period last year. Figure 31: Components of the current account balance ^^■Merchandise trade Services trade ^^■Factor income ^MCurrent transfers -Current account 1000 a a Source: BS. In the third quarter of this year Slovenia recorded the widest surplus in external trade since 1996. Growth in the surplus of goods and services in the third quarter, which had otherwise slowed slightly, mainly reflected 22 Slovenian prices in comparison with those of the trading partners. 23 Higher prices of school meals and higher annual road user charges. 24 As Slovenia has an above-average share of merchandise trade with the euro area, the appreciation of the euro has a smaller impact on the nominal effective exchange rate (and conversely). the improvement in the international environment. With exports recording much higher real growth than imports and amid better terms of trade, the year-on-year increase in merchandise trade was driven by both volume and price factors. The improved terms of trade, with import prices dropping more (-2.9%) than export prices (-1.5%), were largely a consequence of lower euro prices of energy, raw materials and agricultural products. In the first nine months the merchandise surplus totalled EUR 633.3 m, compared with a deficit of EUR 134.1 m in the same period last year. The surplus in trade in services widened as well, mainly due to the growing surplus in trade in intermediation services related to international trade. The larger surplus in trade in travel was driven by growth in turnover in travel services and modest spending of domestic households abroad. The increased surplus in trade in transport services was mainly impacted by a larger surplus in trade in rail and maritime transport. In the first nine months the trade surplus in services totalled EUR 1,668.3 m (EUR 1,389.4 m in the same period last year). Figure32: Breakdown of changes in nominal merchandise trade balance Effect of terms of trade Volume effect Other -Change in nominal balance of merchandise trade 800 a a a a Source: BS; calculations by IMAD. The decline in the deficit in factor income in the third quarter was again mainly due to a smaller net outflow of equity from direct investment. Net income from investment in equity securities was slightly higher, which is related to purchases of shares of other sectors (i.e. enterprises and households) abroad. In the first nine months the total net payments of interest amounted to EUR 352.7 m (compared with EUR 339.6 m in the same period last year). Net payments of interest are rising due to the government sector's borrowing via long-term bonds and tightened borrowing conditions, while the private sector (domestic commercial banks in particular) continues to deleverage abroad.25 25 Since the deepening of the financial crisis in September 2008, domestic commercial banks repaid EUR 10.3 bn in gross external debt by the end of September 2013. Figure 33: Net interest payments by sector ■ Bank of Slovenia ■ Private sector General government Total Figure 34: Financial transactions of the balance of payments by sector 50 -200 -250 a a a a Source: BS; calculations by IMAD. In the third quarter international financial transactions26 recorded a net outflow again (EUR 801.0 m) mainly due to a net capital outflow of the private sector. In the first nine months the net capital outflow reached EUR 2,540.6 m, compared with EUR 692.0 m in the same period last year. After a substantial net inflow in the second quarter owing to the sale of long-term government bonds, investment in securities recorded a net outflow of EUR 422.4 m in the third quarter. The bulk came from investment of other sectors in debt and equity securities and a repayment of a portion of government sector debt to foreign portfolio investors. The net outflow of other investment continued and totalled EUR 253.3 m. Households continued to deposit some of their savings in foreign accounts, while commercial banks and other sectors deleveraged. Commercial banks repaid EUR 707.1 m in foreign loans, the highest figure in three years. They obtained the necessary funds by withdrawing deposits from their accounts abroad and, partly, through the Bank of Slovenia's borrowing from the Eurosystem. Other sectors (mainly enterprises) repaid a portion of short-term commercial credits by which they finance imports of goods and services. Net outflows of financial derivatives are rising this year. As a hedge against the currency risk associated with the sale of dollar bonds, the government sector continued to increase its claims in the segment of financial derivatives in the third quarter. After the majority of the large capital outflow of direct investment in the second quarter resulted from the requalification of loans from direct investment into loans from other sectors, direct investment in the third quarter recorded modest flows. Inter-company financing prevailed, with both Slovenian and foreign investors recording net lending to affiliated companies. 3,000 2,500 2,000 1,500 1,000 E 500 0 -500 -1,000 -1,500 -2,000 -2,500 -3,000 ■ Direct investment I Financial derivatives -Net financial flow ■ Portfolio investment ■ Other investment a a a a Source: BS; calculations by IMAD. Gross external debt amounted to EUR 39.7 bn at the end of September (113.8 % of GDP), EUR 1.1 bn less than in December 2012. Its decline was largely a result of the repayment of a portion of the private sector debt, as commercial banks were repaying long-term loans and liabilities to foreign portfolio investors, and non-residents were withdrawing deposits from Slovenian banks. In addition, there was a decline in the BS's liabilities to the Eurosystem and liabilities between affiliated companies. Gross claims in debt instruments reached EUR 27.5 bn at the end of September (78.5% of estimated GDP), EUR 1.0 bn more than at the end of last year. The increase in gross external claims was mainly a result of short-term trade credits, which is related to the strengthening of exports of goods and services. Government sector claims also Figure 35: Slovenia's net external debt Government sector Bank of Slovenia Private sector -Net external debt 20,000 17,500 15,000 12,500 10,000 E ID 7,500 j= I5,000 2,500 0 -2,500 -5,000 6 Excluding international monetary reserves and statistical errors. a a a a a a Source: BS. Note: Positive (negative) value means net external debt (net external claims) 0 -50 -100 -150 rose, on account of long-term loans extended within the framework of financial assistance to euro area countries. Private sector deleveraging was thus reflected in a decline in net external debt, which totalled EUR 12.1 bn at the end of September (34.9% of estimated GDP), down EUR 2.1 bn from December 2012. Net external debt of the government sector rose, while net external claims of the BS declined. Table 8: Balance of payments I-IX 13, v mio EUR Inflows Outflows Balance1 Balance, I-IX 12 Current account 22,236.7 20,369.9 1,866.8 677.1 - Trade balance (FOB) 16,500.9 15,867.6 633.3 -134.1 - Services 4,130.4 2,462.2 1,668.3 1,389.4 - Income 627.4 933.5 -306.1 -510.4 Current transfers 978.0 1,106.6 -128.6 -67.9 Capital and financial account 1,672.5 -4,327.3 -2,654.7 -722.3 - Capital account 184.9 -263.3 -78.5 -42.4 - Capital transfers 155.8 -245.2 -89.4 -69.3 - Non-produced, non-financial assets 29.1 -18.1 11.0 26.9 - Financial account 1,487.7 -4,063.9 -2,576.3 -679.9 - Direct investment -658.8 -59.3 -718.0 328.1 - Portfolio investment 1,748.4 61.8 1,810.2 -1,781.8 - Financial derivates -41.2 -281.2 -322.5 -74.2 - Other investment 439.3 -3,749.5 -3,310.2 835.9 - Assets 0.0 -1,944.5 -1,944.5 -1,355.9 - Liabilities 439.3 -1,805.0 -1,365.8 2,191.8 - Reserve assets 0.0 -35.7 -35.7 12.1 Net errors and omissions 787.9 0.0 787.9 45.2 Source: BS. Note: 1a minus sign (-) in the balance indicates a surplus of imports over exports in the current account and a rise in assets in the capital and financial account and the central bank's international reserves. Financial markets The problems in the Slovenian banking system are deepening. In October the stock of loans to domestic non-banking sectors dropped by more than EUR 430 m. Almost the entire decline was attributable to increased deleveraging of the corporate sector, with household deleveraging not deviating significantly from this year's monthly average. In the first ten months the stock of loans to domestic nonbanking sectors thus declined by EUR 1.7 bn, nearly five times as much as in the same period of 2012. A large part of this substantial decline was also due to government deleveraging at domestic banks, unlike last year when the stock of this type of loans had still been growing. Banks continued to make net debt repayments abroad and there was also a fall in government and household deposits. The stock of bad claims in the Slovenian banking system continues to grow rapidly. Household deleveraging is continuing. In October household loans fell by EUR 21 m. Households were mainly repaying consumer loans (which accounted for more than two thirds of the total decline), and to a lesser extent, housing loans and loans for other purposes. In the first ten months household loans dropped by around EUR 235 m, which is nearly twice the amount in the same period of last year. Corporate and NFI deleveraging rose notably in October. The stock of corporate and NFI loans fell by around EUR 415 m relative to September, once again almost entirely as a result of corporate deleveraging, as NFI deleveraging remained relatively insignificant. Corporate and NFI debt repayments at domestic banks amounted to EUR 1.4 bn in the first ten months, almost twice as much as in the same period last year. Figure 36: Increase in household, corporate, NFI and government loans Households Enterprises and NFI^ ^^BGovernment -Total Source: BS; calculations by IM AD. Enterprises and NFIs recorded net borrowing abroad in September. The net flow of foreign loans amounted to EUR 43.0 m. Around three quarters of this amount was in long-term loans. In the first three quarters enterprises borrowed EUR 1.1 bn net abroad. Practically the entire net borrowing is related to one-off events,27 according to our estimate; without these events, corporate borrowing abroad would stagnate this year. Excluding this year's one-off events, corporate and NFI foreign loans totalled EUR 5.5 bn at the end of September, according to our estimate, which is only 3.0% less than at the end of 2009, when they had been highest since the outbreak of the financial crisis. In September the gaps between domestic and foreign interest rates for corporate and NFI loans28 rose slightly, to around 240 basis points. 27 i.e., requalification of liabilities from foreign direct investments into loans from non-affiliated companies, and increased borrowing by one of the energy companies, rather than generally improved access of Slovenian enterprises and NFIs to foreign sources of finance. 28 Interest rates for loans over EUR 1 m with a variable, or up to one year with a fixed interest rate. Figure 37: Net corporate and NFI borrowing abroad and gaps between domestic and foreign interest rates ^^■Short-term loans (left axis) ^^■Long-term loans (left axis) -Gap between domestic and foreign interest rates (right axis) 700 -1-1- 550 600 500 -400 -300 ^^ 200 -100 0 -100 -200 -300 -400 500 450 400 350 300 Source: BS; calculations by IMAD. 250 200 150 100 50 0 Figure 38: Net repayments of foreign liabilities of Slovenian banks 2,000 - 1,500 1,000 0 -1,000 -1,500 I Bonds I Deposits I Short-term loans ■ Long-term loans Total i- '11 Source: BS; calculations by IMAD. Banks continued to increase net repayments of foreign liabilities in September. Net repayments amounted close to EUR 250 m and were among the highest monthly repayments this year. Banks were repaying long-term liabilities only, with net repayments of long-term loans accounting for the largest share; on the other hand, deposits from abroad rose more notably in September, recording a net inflow of almost EUR 95 m. In the first three quarters of this year banks repaid EUR 1.7 bn net in foreign loans, more than a third less than in the comparable period last year. Liabilities to foreign banks thus stood at EUR 6.6 bn at the end of September, around two thirds lower than the highest level at the end of August 2008. The stocks of both household and government deposits declined in October. Household deposits shrank almost by EUR 100 m. More than 90.0% of the decline stemmed from the outflow of overnight deposits. Short-term deposits and deposits redeemable at notice also dropped, albeit Table9: Financial market indicators Domestic bank loans to nonbanking sector and household savings Nominal amounts, EUR bn Nominal loan growth, % 31. XII 12 31. X 13 31. X 13/30. IX 13 31. X 13/31. XII 12 31. X 13/31. X 12 Loans total 31,464.6 29,758.4 -1.4 -5.4 -8.1 Enterprises and NFI 20,456.5 19,042.5 -2.1 -6.9 -10.7 Government 1,741.4 1,685.4 0.4 -3.2 -1.9 Households 9,266.7 9,030.5 -0.2 -2.5 -3.3 Consumer credits 2,481.8 2,320.9 -0.6 -6.5 -8.6 Lending for house purchase 5,258.9 5,252.1 -0.1 -0.1 -0.1 Other lending 1,526.1 1,457.5 -0.1 -4.5 -5.5 Bank deposits total 15,051.3 14,594.4 -0.7 -3.0 -2.0 Overnight deposits 6,479.4 6,359.8 -1.5 -1.8 -1.0 Short-term deposits 4,010.9 3,739.8 -0.2 -6.8 -5.4 Long-term deposits 4,554.7 4,490.2 0.2 -1.4 -0.3 Deposits redeemable at notice 6.2 4.6 -43.5 -25.7 -32.2 Mutual funds 1,830.0 1,842.6 1.6 0.7 0.1 Government bank deposits, total 2,562.7 3,746.5 -0.3 46.2 65.6 Overnight deposits 196.6 392.8 18.8 99.8 77.3 Short-term deposits 828.4 1,782.7 -3.9 115.2 287.5 Long-term deposits 1,537.1 1,515.3 0.2 -1.4 -3.9 Deposits redeemable at notice 0.5 55.7 -6.2 10.117.7 1.069.5 Sources: Monthly Bulletin of the BS, SMA (Securities Market Agency); calculations by IMAD. much less (by a total of EUR 10 m). The stock of long-term deposits rose slightly again, by EUR 7 m. In the first ten months the stock household deposits dropped by around EUR 460 m, which is nearly twice the amount in the same period of last year. All types of deposits shrank, particularly short-term deposits. Government deposits fell by a solid EUR 10 m in October, most notably short-term deposits. In the first ten months government deposits at domestic commercial banks rose by around EUR 1.2 bn, in contrast to the same period last year when they had fallen almost by EUR 600 m. Figure 39: Share of bad and non-performing claims and creation of impairments and provisions in the Slovenian banking system Provisions and impairments (left axis) -Share of non-performing claims (right axis) — Share of bad claims (right axis) 500 450 400 350 300 250 m 200 150 100 50 0 -50 22 20 18 16 14 12 10 8 6 4 2 0 Source: BS; calculations by IM AD. Figure 40: 10-year government bond yield spread vis-avis German bond 4 Source: Bloomberg, calculations by IMAD. The quality of banks' assets continues to deteriorate rapidly. Totalling EUR 8.1 bn, bad claims29 accounted for as much as 17.5% of the banking sector's total exposure in September. In September the quality of banks' assets deteriorated particularly in activities tied to construction and management buyouts. In the first three quarters the amount of bad claims rose by a high of EUR 1.4 bn, which is more than in 2012 overall. The yield to maturity of the 10-year euro bond and the spread with respect to the German bond declined in November (-50 basis points). The decline is related to the issue of a 3-year bond in the amount of EUR 1.5 bn on 14 November. The yield and the spread vis-a-vis the German bond remained stable in the second half of the month. At the end of the month the yield to maturity totalled 5.16%, the lowest figure in the last five months. Public finance The general government deficit in the first nine months of this year was EUR 1.3 bn,30 which is EUR 234 m more than in the same period of 2012. The deficit's increasing trend (year-on-year) reverted in the month of July. This is explained by improving revenue, mainly on account of higher revenue from VAT in the last three months. In the first nine months general government revenue was EUR 260 m (-2.4%) lower than in the same period last year, while expenditure was EUR 26 m (-0.2%) lower. Figure 41: Consolidated general government revenue and expenditure 17.5 17.0 16.0 J? 15.5 E 15.0 .^E 14.5 Source: MF; calculations by IMAD. After the decline in the first half of the year, general government revenue improved year-on-year in the last three months. In the first half of the year revenue was 5.7% lower year-on-year and in the first nine months 2.4% lower. The improvement is due to the increase in non-tax 29 Claims rated C, D and E. 30 According to the consolidated balance on the cash flow basis (GFS). 7 6 5 3 14.0 2 0 Table 10: Taxes and social security contributions EUR m Growth, % Structure, % I-IX 2013 IX 2013/IX 2012 I-IX 2013/I-I-IX 2012 I-IX 2012 I-IX 2013 General government revenue - total 10,648.0 7.3 -2.4 100.0 100.0 Corporate income tax 163.2 -25.6 -61.8 3.9 1.5 Personal income tax 1,363.9 -4.1 -4.9 13.2 12.8 Value added tax 2,135.1 14.9 -0.9 19.8 20.1 Excise duties 1,109.3 56.0 -0.1 10.2 10.4 Social security contributions 3,809.6 -2.2 -4.3 36.5 35.8 Other general government revenues 2,066.8 13.9 14.9 16.5 19.4 Source: PPA - Report on Payments of All Public Revenues; calculations by IMAD. Table 11: Consolidated general government revenue and expenditure 2012 2013 EUR m % of GDP Growth, % I-IX 13, EUR m I-IX 13/I-IX 12 Revenue - total 14,999.1 42.3 0.1 10,648.0 -2.4 - Tax revenues 13,118.3 37.0 -0.7 9,242.3 -4.3 - Taxes on income and profit 2,656.6 7.5 -2.5 1,530.5 -17.9 - Social security contributions 5,244.1 14.8 -0.4 3,809.6 -4.3 - Domestic taxes on goods and servises 4,876.1 13.7 0.4 3,620.9 1.3 - Receipts from the EU budget 845.1 2.4 3.7 540.6 -2.7 Expenditure - total 16,125.7 45.5 -2.5 11,994.0 -0.2 - Wages and other personnel expenditure 3,184.7 9.0 -4.4 2,700.9 -5.0 - Purchases of goods and services 2,373.0 6.7 -2.9 1,666.0 -4.2 -Domestic and foreign interest payments 647.9 1.8 23.0 692.1 16.8 - Transfers to individuals and households 6,384.2 18.0 -2.3 4,788.7 -0.9 - Capital expenditure 915.0 2.6 -10.6 547.6 -3.6 - Capital transfers 319.9 0.9 -14.0 163.9 -1.0 - Payment to the EU budget 390.3 1.1 -3.7 360.4 9.1 Deficit -1,122.8 -3.2 -28.2 -1,346.0 21.0 Source: MF, Public Finance Bulletin. revenue in July, higher VAT revenue since July and the increase in revenue from excise duties in September. The overall lower in revenue in the first nine months can be explained primarily by lower tax revenue (by EUR 415 m). In particular revenue from corporate income tax dropped, by EUR 264 m, reflecting changes in the corporate income tax system adopted in 2012 (a reduction of the tax rate and the tax base, payment of tax advances at higher rate), whose effect on cash accounts is visible in 2013, and a slowdown in economic activity. Revenue from personal income tax was lower by EUR 71 m. VAT revenue, which has been up year-on-year since the rise in VAT in July, was only EUR 20 m lower year-on-year in the first nine months. As a result of a lower number of employees, social security contributions were also down year-on-year (by EUR 172 m). Revenue from the EU budget also declined (by EUR 15 m). The total decline was mitigated by non-tax revenue, which was EUR 139 m higher than in the first nine months of last year, mainly as a result of the increase31 in July. General government expenditure remained lower in the first nine months compared with the same period one year earlier. This was a consequence of lower expenditures on wages (by EUR 111 m), goods and services (by EUR 74 m) and social transfers (by EUR 46 m). Expenditure on social security contributions also decreased (by EUR 31 m), reflecting the reduction of the total number of employees in the government sector. Expenditure on investment in the first nine months was lower than last year (by EUR 21 m), but since July it has been increasing year-on-year. Interest payments increased (year-on-year) in the first nine months (EUR 96 m), as was the use of the budget reserves (as a result of a significant increase in February; EUR 57 m),32 subsidies (EUR 38 m), which have been up year-on-year since May, and payments to the EU budget (EUR 30 m). Among social transfers, the largest declines were recorded for family benefits and parental compensations, scholarships and social security transfers. Only expenditure on pensions was up year-on-year (EUR 83 m) as a result of a higher number of pensioners. This 31 July's increase in non-tax revenue was a result of higher revenue from entrepreneurial income. 32 Since May 2013 expenditure on scholarships has been paid from direct government funds or from reserves. trend and the decline in social security contributions pose an important challenge for fiscal consolidation in the short term. The net surplus of the state budget against the EU budget in the first ten months was smaller (EUR 217.2 m) than in the same period last year (EUR 234.6 m). Given the higher level planned (to comply with the N+2/3 rule), the absorption rate of all receipts into the state budget in the first ten months (50.3% of the level envisaged in the revised budget, or EUR 596.3 m) was lower than in the same period last year (66.2% of the level planned, or EUR 592.9 m). In the same period Slovenia paid EUR 379.0 m into the EU budget, or 91.5% of the level planned. Despite low payments into the state budget in the last five months, the highest absorption rate (68.7%) was recorded for funds received under the Common Agricultural and Fisheries Policies (EUR 205.6 m; in October EUR 4.8 m) and the lowest for receipts from the Cohesion Fund (EUR 85.3 m; in October EUR 23.8 m, the highest in the current year). The nominal amount of receipts from the Structural Funds (EUR 290 m) was the same as in the comparable period last year,33 but as a result of the higher level planned, the absorption rate in the first ten months of this year was lower (46.5%) than in the same period of 2012 (70.1%). Figure 42: Planned and absorbed EU funds, 2013 ■ Absorption rate relative to the revised budget 2013 ■ Absorption rate relative to the revised budget 2012 Other Common Agricultural Policy 0 10 20 30 40 50 60 70 80 90 100 In % Source: MF; calculations by IMAD.. Figure 43: Receipts from the EU budget in 2012 and 2013 ■ Total receipts in 2013 (January-October) ■ Total receipts in 2012 (January-October) Other Common Agricultural Policy In EUR m Source: MF; calculations by IMAD. 33 To comply with the N+2/3 rule, the revised budget envisages EUR 624 m in receipts from structural funds in 2013; in 2012, EUR 413 m. M u a o ■Ö 01 u 31 0! Life satisfaction In June 2013, the proportion of people satisfied with their lives34 (85.0%) was equal to that a year earlier, according to the Social Climate survey,35 and Slovenia's ranking among the EU-27 Member States remained unchanged (11th). In the EU-2736 life satisfaction is lower than in Slovenia, on average, but seems to be recovering and pessimism is receding.37 In comparison with 2012, the share of satisfied people rose in fifteen EU Member States, remained unchanged in four (including Slovenia), and declined in eight (most notably in Ireland and Cyprus). Figure 44: Life satisfaction in Slovenia and EU-27 Member States 90 70 40 Source: Eurobarometer. In Slovenia people are the most satisfied with the area they live in, the health system, the financial situation of their households, their own employment situation and their relations with people from different cultural backgrounds. More than half of respondents have positive views on these areas. Fewer than half, yet more than a third, are satisfied with the pension system and unemployment benefits. On the other hand, fewer than a third of respondents are satisfied with other areas, the least with the employment and economic situation in the country. More people than on average in the EU-27 are satisfied with their relations with people from different cultural backgrounds, their personal employment situation and the affordability of 34 The Eurobarometer survey measures life satisfaction with the following question: All things considered, how satisfied would you say you are with your life these days? The possible answers are: very satisfied, satisfied, dissatisfied and very dissatisfied. In the context of this analysis, the category of satisfied people includes very satisfied and satisfied people. 35 These are the results of a special Eurobarometer survey, Social Climate, conducted since 2009. Besides general life satisfaction, the survey includes evaluations of fourteen sub-areas of life. 36 See also: Zalc, Julien. European Public Opinion: Is this the end of pessimism? European Issues N0290, 8th October 2012, Policy Paper. Foundation Robert Shuman. 37 The pessimism indicator shows the proportion of people expecting the next twelve months to be worse and the proportion of those who assess that the situation is worse than five years before. energy. However, people in Slovenia are less satisfied than in the EU overall (with the gap widening over the years) with the effectiveness of public administration, the way the country addresses inequality and poverty, unemployment benefits and the affordability of housing. The share of people satisfied with the cost of living and the economic and employment situation in Slovenia has been below the EU-27 average in the total period since 2009. In 2013 satisfaction has declined in most of the evaluated categories, and there has been an increase in pessimism. Satisfaction with unemployment benefits, the way inequalities and poverty are addressed and the effectiveness of public administration has declined most notably relative to 2012 but people have, surprisingly, become more positive about their personal employment situation. Relative to 2009, a decline in satisfaction with the effectiveness of public administration stands out in particular. The only indicator that is higher than in 2009 is satisfaction with the health system, but this has also declined in 2013 (for the first time). The share of "pessimists" has increased in the last year in almost all areas covered in the survey, particularly those that are the government's responsibility, i.e. public administration and the social protection system. It seems that because of the crisis, people are satisfied with the current situation as they expect the circumstances to worsen. This explains why people are fairly satisfied with their life in general (the share of satisfied people in 2013 is equal to that in 2012, or at the 2009 level again), why they hold more positive perceptions about their employment situation than they did in 2012, and why - at the personal level - they are fairly satisfied with the areas they otherwise assess as the worst at the level of the country. In terms of the latter the gap is quite wide, specifically in the evaluation of the personal employment situation (57% of satisfied people) compared with the general employment situation (4%), or the evaluation of the financial situation of their households (58% of satisfied people) compared with the perception of the general economic situation in the country (4%).The positive evaluation of life satisfaction in general can, in part, be attributed to the adaptation of expectations, but at the same time, it also reflects the actual high and stable satisfaction with health, work and personal finances. Analysis shows that life satisfaction tends to be higher if people are able to meet their needs in areas they value more.38 The areas of life deemed most important in Slovenia are health, work and family, which could also explain why the overall satisfaction in Slovenia is relatively high and stable. 38 Overall life satisfaction is a type of summary of partial (dis)satisfactions with different areas of life, which can fluctuate significantly one way or the other. 80 60 50 30 Table 12: Satisfaction with life in relation to different areas, Slovenia and the EU-27 average Slovenia EU-27 Satisfied (satisfied and very satisfied combined) Things will deteriorate in the next 12 months Things have got worse compared with five years ago Satisfied (satisfied and very satisfied combined) Things will deteriorate in the next 12 months Things have got worse compared with five years ago General life situation 2013 (in %) 85 27 54 77 16 37 Change 2013-2012 (in p.p.) 0 2 5 1 -1 0 Change 2013-2009 (in p.p.) 0 7 10 -1 -2 6 How do you evaluate the current situation when it comes to ..? The area you live in 2013 (in %) 80 23 38 85 11 23 Change 2013-2012 (in p.p.) -4 2 -2 1 -1 -1 Change 2013-2009 (in p.p.) -7 5 8 -2 1 6 Health care provision 2013 (in %) 67 48 58 63 33 49 Change 2013-2012 (in p.p.) -4 3 7 1 1 -1 Change 2013-2009 (in p.p.) 17 13 8 -1 6 10 Provision of pensions 2013 (in %) 42 59 69 38 41 56 Change 2013-2012 (in p.p.) -2 6 2 -2 1 -2 Change 2013-2009 (in p.p.) -7 17 16 -2 -8 15 Unemployment benefits 2013 (in %) 33 63 71 35 38 50 Change 2013-2012 (in p.p.) -12 -1 -1 -3 1 1 Change 2013-2009 (in p.p.) -10 21 20 -1 7 12 Cost of living 2013 (in %) 13 78 94 28 57 81 Change 2013-2012 (in p.p.) -5 7 3 -1 0 -1 Change 2013-2009 (in p.p.) -5 17 9 0 6 5 Relations between people from different cultural backgrounds 2013 (in %) 21 59 69 29 32 47 Change 2013-2012 (in p.p.) -8 8 4 -2 1 1 Change 2013-2009 (in p.p.) -11 20 16 -2 2 9 Affordability of energy 2013 (in %) 33 61 79 30 48 69 Change 2013-2012 (in p.p.) 3 1 -3 1 -4 -4 Change 2013-2009 (in p.p.) -8 18 14 -3 7 7 Affordability of housing 2013 (in %) 15 56 74 27 43 66 Change 2013-2012 (in p.p.) 1 4 -1 2 0 -1 Change 2013-2009 (in p.p.) -2 11 3 0 6 4 The way the public administration is run 2013 (in %) 25 47 65 40 27 43 Change 2013-2012 (in p.p.) -8 6 6 0 2 2 Change 2013-2009 (in p.p.) -31 21 27 -2 5 10 Economic situation in the country 2013 (in %) 4 70 93 27 42 71 Change 2013-2012 (in p.p.) -4 6 0 -3 0 1 Change 2013-2009 (in p.p.) -13 27 20 5 6 -7 Personal employment situation 2013 (in %) 57 22 41 54 13 29 Change 2013-2012 (in p.p.) 4 0 2 2 -1 1 Change 2013-2009 (in p.p.) -1 10 6 2 2 6 Household financial situation 2013 (in %) 58 36 60 63 21 41 Change 2013-2012 (in p.p.) -3 2 4 1 1 1 Change 2013-2009 (in p.p.) -9 14 13 -1 1 6 Employment situation in the country 2013 (in %) 4 70 93 21 43 71 Change 2013-2012 (in p.p.) -1 7 0 -1 1 1 Change 2013-2009 (in p.p.) -4 24 17 6 5 -5 Source: Evrobarometer, Social Climate, 2013. Note: In satisfaction, a higher number means a larger share of satisfied people and a positive difference means improvement, i.e. a larger proportion of satisfied people than in the past. Conversely, in the columns of expectations for the coming twelve months and evaluations of how things have changed compared with five years ago, a larger share or a positive difference indicates deterioration, i.e. a larger proportion of pessimists than in the past. Agricultural production and food security The main objective of the development of agriculture and food industry in Slovenia and the EU is to ensure food security by stable food production. It has been defined in previous strategic documents, as well as in the resolution on strategic objectives for this sector's development,39 which emphasises that in the circumstances of increasingly risky world markets, an appropriate extent of food self-sufficiency will contribute to the stability of supply. Data show that as in previous years, Slovenia has not made much progress in this area in the recent period. After being almost unchanged in the last few years, in 2012 the volume of agricultural production dropped to the lowest level in a decade. According to the economic accounts for agriculture, it shrank by more than a tenth and was even somewhat smaller than in the, weather-wise, exceptionally unfavourable year 2003. This was mostly a result of a fall in crop production (by around 17%), particularly fruits, grapes/wine and industrial plants. Given that production did not even remain the same, let alone increase in any crop category, the share of crop production in total agricultural production declined to around 52%. Animal production, which has been on a downward trend for a long period, decreased by 3.0%, and was around 9% lower than ten years before. This sector, where year-on-year fluctuations tend to be smaller, also experienced one of the most pronounced declines in 2012. According to the provisional data, no improvement can be expected this year. Unfavourable weather conditions with a belated spring followed by a dry summer were reflected Figure 45: Growth in agricultural production, 20032012 ^^■Total -Crop production -Animal production 70 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: SURS; calculations by IMAD. in one of the poorest harvests. All types of crops recorded significantly lower yields than last year, also those harvested before the summer drought. Only the harvest in the fruit and wine growing sector is looking better than last year and should be somewhere near the last years' average. Total meat production also seems to be lower. After a long period of growth, milk collection also started to decline and was around 4% lower year-on-year in the first nine months. Agricultural production in the EU-27 overall declined much less last year than in Slovenia and remained higher than Table 13: Growth in agricultural production by product groups, 2003-2012 Structure in 2012,* in % Production volume, growth rates, in % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Crop production 51.6 -25.4 46.7 -2.5 -12.6 3.9 -1.8 2.8 0.4 1.6 -16.8 Of which: Cereals 9.5 -33.9 42.7 -0.6 -13.7 8.8 8.0 -6.6 7.4 8.2 -4.6 Industrial plants 1.9 -18.0 17.3 16.0 -1.4 -29.1 -7.0 13.2 6.9 3.5 -24.9 Fodder plants 16.8 -29.3 49.8 11.2 -21.0 12.6 3.0 0.2 3.1 -7.0 -12.9 Vegetables and horticultural products 6.6 -20.5 59.6 2.6 -12.2 -15.5 12.3 9.9 -28.0 15.2 -3.1 Potatoes 1.4 -34.6 50.6 -16.1 -20.1 28.0 -20.2 -6.3 14.4 -4.2 -18.5 Fruit 6.9 -21.4 35.8 -16.8 1.5 1.2 -10.8 -0.8 12.2 -8.1 -29.9 Wine 8.6 -19.0 51.1 -20.1 -9.4 8.9 -11.9 10.9 0.8 12.2 -26.6 Animal production 46.6 -0.7 -3.3 -0.6 -2.0 4.3 -2.3 -3.0 -0.2 -1.2 -3.0 Of which: Animals 27.5 2.8 -3.9 -1.7 -2.6 3.4 -3.7 -4.3 -0.4 -3.5 -2.8 Animal products 19.1 -5.6 -2.4 1.1 -1.1 5.6 -0.3 -1.1 0.0 2.3 -3.2 Total agricultural goods production 98.2 -13.1 19.5 -1.6 -7.5 4.1 -2.0 0.1 0.1 0.4 -10.7 Agricultural services 1.8 0.0 3.4 8.8 0.0 -14.0 4.8 -4.1 -0.1 -2.8 0.0 Total agricultural production 100.0 -12.9 19.2 -1.5 -7.3 3.7 -1.9 0.0 0.1 0.3 -10.5 Source: SURS; calculations by IMAD. Note: ^calculated from values at producer prices. 39 Resolution on the strategic guidelines for the development of the Slovenian agriculture and food industry, "Securing the National Assembly in March 2011 (the Official Gazette of the RS, No. 25/2011). In addition to ensuring food security, edge of the sector, sustainable use of production potentials and balanced and socially sustainable rural development. the Food it aims at for Tomorrow," adopted by increasing the competitive in 2010. In 2013 it is expected to improve at least in some segments. Having increased by 4.0% in 2011 on average in the EU-27, agricultural production dropped by more than 2% last year, according to Eurostat's estimate. Crop production recorded a larger decline, but it was less pronounced than in Slovenia. Crop production also dropped less in the neighbouring countries, which have similar weather conditions. Only three EU countries are estimated to have seen larger declines in agricultural production than Slovenia last year (Rumania, Lithuania and Latvia). This year's total output of some crops in the EU-27 appears to be better, according to the provisional estimates, which will help increase the stocks and lower the prices. In animal production, this year's increased production of poultry will mitigate the consequences of the decline in other types of meat, while the high milk prices should stimulate milk production. Figure 46: Growth in agricultural production in Slovenia, the EU-27 average and neighbouring countries, 20072012 -EU-27 -SLOVENIA ---------Hungary Figure 47: Self-sufficiency rate for basic agricultural products in Slovenia, 2002-2012 ■ Austria ---Italy Croatia Vegetables Potatoes Cereals Meat Eggs Milk Source: SURS, Agricultural Institute of Slovenia. 2007 2008 2009 2010 2011 Source: Eurostat; calculations by IM AD. With the stagnation of domestic agricultural production, Slovenia's capacity to meet its own needs for food decreases, and thus also the opportunities for countryside development in a broader sense. The self-sufficiency rate40 is fairly low and declining in all basic agricultural products except milk and eggs. In 2012 it declined further in all product groups, including vegetables, which experienced the most modest results. In addition to dependence on foreign trade, low local production generally means a less vibrant and productive countryside and unexploited employment opportunities for the local population. There is an increasingly pressing need for changes and development towards higher agricultural productivity, also in view of the high dependence on financial assistance.41 40 The ability to meet own needs or the rate of self-sufficiency is calculated as a ratio of domestic production to total domestic consumption. For Slovenia, balance sheets are available for vegetables, cereals and potatoes (as well as for rice and sugar, where Slovenia has almost no own production) and all types of meat, eggs and milk. 41 For more on agricultural productivity see SEM 11/2011, pp. 31-32; on budgetary supports SEM 5/2011, pp. 34-36. 2002 2007 2011 2012 X "ö C a a (ü "5 (U MAIN INDICATORS 2008 2009 2010 2011 2012 2013 2014 2015 Autumn forecast 2013 GDP (real growth rates, in %) 3.4 -7.9 1.3 0.7 -2.5 -2.4 -0.8 0.4 GDP in EUR million (current prices and current exchange rate) 37,244 35,420 35,485 36,150 35,319 34,908 35,132 35,747 GDP per capita, in EUR (current prices and current exchange rate) 18,420 17,349 17,320 17,610 17,172 16,942 17,027 17,305 GDP per capita (PPS)1 22,700 20,300 20,500 21,000 20,900 GDP per capita (PPS EU27=100)' 91 86 83 83 81 Gross national income (current prices and current fixed exchange rate) 36,273 34,823 35,028 35,759 34,931 34,196 34,362 34,910 Gross national disposable income (current prices and current fixed exchange rate) 35,904 34,519 34,875 35,680 34,721 34,295 34,268 34,758 Rate of registered unemployment 6.7 9.1 10.7 11.8 12.0 13.3 13.6 13.5 Standardised rate of unemployment (ILO) 4.4 5.9 7.3 8.2 8.9 10.7 11.0 10.6 Labour productivity (GDP per employee) 0.8 -6.2 3.5 2.4 -1.7 -0.1 0.6 1.1 Inflation,2 year average 5.7 0.9 1.8 1.8 2.6 2.0 1.9 1.4 Inflation,2 end of the year 2.1 1.8 1.9 2.0 2.7 2.3 1.4 1.7 INTERNATIONAL TRADE - BALANCE OF PAYMENTS STATISTICS Exports of goods and services3 (real growth rates, in %) 4.0 -16.1 10.2 7.0 0.6 2.0 3.0 4.1 Exports of goods 1.8 -16.6 12.0 8.2 -0.1 1.6 3.1 4.3 Exports of services 14.3 -14.0 3.5 1.9 3.7 3.8 2.7 3.2 Imports of goods and services3 (real growth rates, in %) 3.7 -19.2 7.4 5.6 -4.7 0.1 2.1 3.9 Imports of goods 3.0 -20.2 8.3 6.6 -5.1 0.3 2.0 3.9 Imports of services 8.2 -12.4 2.6 -0.6 -2.2 -1.0 2.5 4.2 Current account balance, in EUR million -2,028 -173 -50 146 1,159 1,731 1,765 1,817 As a per cent share relative to GDP -5.4 -0.5 -0.1 0.4 3.3 5.0 5.0 5.1 Gross external debt, in EUR million 39,234 40,294 40,723 40,241 40,838 39,7125 As a per cent share relative to GDP 105.3 113.8 114.8 111.3 115.6 Ratio of USD to EUR 1.471 1.393 1.327 1.392 1.286 1.320 1.331 1.331 DOMESTIC DEMAND - NATIONAL ACCOUNTS STATISTICS Private consumption (real growth rates, in %) 2.3 -0.1 1.5 0.8 -4.8 -3.5 -2.7 0.5 As a % of GDP4 51.8 54.8 56.4 56.8 56.3 55.7 54.8 54.7 Government consumption (real growth rates, in %) 5.9 2.5 1.3 -1.6 -1.3 -2.5 -1.5 -1.0 As a % of GDP4 18.1 20.2 20.8 20.8 20.8 20.4 20.3 20.0 Gross fixed capital formation (real growth rates, in %) 7.1 -23.8 -15.3 -5.5 -8.2 -1.6 -4.0 -0.9 As a % of GDP4 28.6 23.1 19.7 18.6 17.8 17.7 17.2 17.1 Sources of data: SURS, BS, Eurostat, calculations and forecasts by IMAD (Autumn Forecast, September 2013). Notes: 1Measured in purchasing power standard. ^Consumer price index. ^Balance of payments statistics (exports F.O.B., imports F.O.B.); real growth rates are adjusted for inter currency changes and changes in prices on foreign markets. 4Shares GDP are calculated for GDP in current prices at fixed exchange rate (EUR=239.64). 5End September 2013. PRODUCTION 2010 2011 2012 2011 2012 2013 2011 2012 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 9 10 11 12 1 INDUSTRIAL PRODUCTION, y-o-y growth rates, % Industry B+C+D 7.1 1.3 -1.1 -0.8 -3.8 -0.2 -1.6 -0.4 -2.3 -2.4 -1.3 -0.4 1.5 -3.1 -0.4 -8.3 0.5 B Mining and quarrying 13.9 -7.9 -7.4 -9.6 -8.7 -10.2 -2.3 -3.5 -13.3 8.7 -7.8 -5.3 -2.4 -7.2 -3.0 -17.0 6.1 C Manufacturing 7.6 1.1 -2.3 -1.1 -4.6 -1.0 -3.0 -2.1 -3.1 -3.6 -1.5 -0.7 1.8 -3.8 -1.6 -8.8 0.0 D Electricity, gas & steam supply1 1.8 5.0 10.5 5.1 4.0 8.3 12.7 16.1 6.1 7.0 1.3 3.3 -0.3 4.7 13.2 -4.0 3.5 CONSTRUCTION,2 real indices of construction put in place, y-o-y growth rates, % Construction, total -16.9 -24.8 -16.8 -24.5 -19.1 -15.3 -16.7 -13.2 -21.6 -24.5 -10.5 -4.2 -16.3 -24.4 -7.8 -24.0 -21.7 Buildings -14.0 -39.7 -17.3 -34.3 -35.9 -13.0 -6.7 -18.1 -30.0 -40.9 -25.1 -16.9 -30.0 -33.3 -28.6 -44.5 -31.1 Civil engineering -19.0 -15.3 -16.6 -19.9 -10.1 -21.2 -20.9 -10.1 -16.2 -8.5 -2.6 0.7 -9.7 -21.0 0.7 -7.0 -18.1 TRANSPORT, tonne-km in m, y-o-y growth rates, % Tonne-km in road transport 7.9 3.2 -3.4 3.6 11.7 6.0 -5.3 -5.9 -7.8 -2.7 -1.8 Tonne-km in rail transport 28.2 9.7 -7.5 8.5 -1.6 -8.7 -8.0 -5.8 -7.5 -0.1 0.4 Distributive trades, y-o-y growth rates, % Total real turnover* 3.6 3.1 0.2 2.9 -0.5 0.6 -4.3 -3.2 -2.7 -4.9 -5.8 -6.4 2.4 0.7 -0.5 -1.8 2.6 Real turnover in retail trade -0.1 1.4 0.3 2.2 0.2 2.5 -2.7 -1.7 -1.0 -2.6 -3.8 -5.5 2.1 0.5 1.3 -1.1 4.0 Real turnover in the sale and maintenance of motor vehicles 12.2 6.6 0.0 4.4 -1.9 -2.8 -7.2 -5.7 -6.4 -9.8 -10.3 -8.2 3.0 1.3 -3.6 -3.4 -0.1 Nominal turnover in wholesale trade & commission trade 1.3 5.8 0.6 4.6 3.4 3.4 -0.6 1.2 -1.2 -5.4 1.1 -1.4 5.6 5.7 5.6 -0.9 8.6 TOURISM, y-o-y growth rates, %, new methodology from 2009 onwards Total, overnight stays -1.5 5.3 -4.0 6.6 3.1 0.7 1.2 1.2 1.9 -3.4 -1.5 2.9 9.8 1.9 7.0 1.2 0.2 Domestic tourists, overnight stays -4.2 0.5 -10.9 0.8 0.4 -0.5 -4.6 -7.5 -5.2 -6.1 -5.3 -2.4 7.3 -2.9 8.6 -3.3 -0.3 Foreign tourists, overnight stays 0.7 9.1 0.9 10.2 5.5 2.0 5.1 6.3 8.1 -0.6 0.9 5.6 11.2 5.5 5.2 5.8 0.6 Nominal turnover market services (without distributive trades) 2.7 3.7 -1.1 4.8 -0.3 -0.6 0.5 -0.4 -3.7 -6.1 -2.9 0.7 7.5 -1.5 0.2 0.5 0.3 AGRICULTURE, y-o-y growth rates, % Purchase of agricultural products, SIT bn, since 2007 in EUR m 454.5 478.9 481.7 125.7 139.5 108.4 110.4 128.4 134.5 104.4 111.1 123.2 43.7 48.9 44.0 46.7 34.3 BUSSINES TENDENCY (indicator values**) Sentiment indicator -9 -7 -17 -7 -10 -12 -16 -19 -20 -15 -14 -1^ -6 -9 -10 -11 -12 Confidence indicator - in manufacturing -1 0 -11 -1 -7 -6 -11 -14 -13 -9 -6 -4 -2 -8 -7 -6 -3 - in construction -57 -46 -41 -44 -43 -41 -44 -39 -39 -30 -22 -18 -43 -42 -44 -42 -43 - in services -3 1 -12 4 -4 -8 -8 -14 -18 -12 -12 -11 2 0 -3 -9 -11 - in retail trade 7 8 2 2 13 6 4 1 -5 -2 2 6 12 12 16 10 3 Consumer confidence indicator -25 -25 -35 -25 -24 -27 -36 -39 -37 -29 -34 -34 -23 -26 -26 -19 -28 Source of data: SURS. Note: "Only companies with activity of electricity supply are included. 2The survey covers all larger construction enterprises and some other enterprises that perform construction work. *Total real turnover in retail trade, the sale and repair of motor wehicles, and retail sale of automotive fuels. **Seasonally adjusted data. 2012 2013 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 3.3 -3.6 2.2 -3.9 -2.6 3.6 3.1 -6.7 5.2 -4.9 -7.5 0.2 -0.7 -6.3 3.1 -1.9 -4.9 2.3 -5.8 1.8 - -11.4 -22.0 -8.2 9.8 -7.0 -5.7 1.4 -5.8 1.2 -17.9 -24.9 -9.6 12.9 24.1 -2.5 -9.2 -11.5 3.7 0.5 -19.1 1.9 -4.2 1.9 -5.5 -4.9 1.8 1.6 -8.4 4.7 -5.5 -9.1 -0.9 -0.8 -8.4 2.9 -2.2 -5.1 2.3 -6.8 1.7 16.3 5.3 5.6 9.4 24.0 22.6 16.2 9.8 11.8 2.3 4.9 11.3 0.0 10.2 6.1 0.7 -2.4 1.9 1.7 6.3 - -24.3 -3.1 -13.5 -23.8 -11.7 -19.6 -14.4 -6.4 -22.5 -26.1 -14.8 -23.2 -14.0 -31.7 -18.7 -11.6 -2.0 1.8 -5.4 -7.9 -31.0 27.6 -7.2 -15.6 4.4 -23.9 -11.9 -18.6 -34.6 -19.4 -35.4 -38.2 -28.0 -50.1 -36.2 -24.2 -14.1 -19.1 -19.8 -12.1 -22.8 -22.0 -18.6 -26.5 -17.0 -17.1 -15.7 1.2 -15.0 -27.2 -2.1 -8.6 -0.6 -13.6 -6.3 -5.9 3.5 11.0 2.2 -8.0 - - - - - - - - 1.0 -1.8 -4.0 -5.2 -3.7 -0.6 -3.8 -10.3 -3.4 -5.4 -8.0 -4.8 -8.7 -7.7 2.8 1.3 2.7 -4.2 -3.4 1.3 - 3.5 -0.1 -3.5 -3.1 -1.5 -0.6 -0.8 -6.5 -4.1 -5.8 -7.4 -4.4 -9.3 -7.2 -1.7 -1.7 -3.7 -4.9 -4.6 -4.2 -3.5 -4.8 -5.1 -8.8 -7.7 -0.6 -10.8 -17.9 -2.1 -4.5 -9.2 -5.7 -7.4 -8.5 11.4 6.8 15.4 -2.7 -0.2 13.9 3.9 -0.9 0.1 0.4 -2.2 7.2 2.8 -5.4 4.8 -2.0 -6.5 1.5 -5.6 -10.9 5.7 -0.9 -1.3 0.7 -4.7 -0.2 -0.3 2.4 -0.9 7.9 -1.9 1.3 2.5 -1.4 -3.5 9.3 2.2 -10.5 0.2 0.6 -11.6 9.2 -2.4 3.4 2.2 3.2 - -3.3 2.8 -14.3 -1.6 0.9 -9.9 -4.1 -9.8 -6.6 -8.1 -0.7 -10.0 -1.3 -8.2 -6.0 2.0 -10.0 0.7 -4.6 -3.5 4.5 1.9 9.4 14.1 -3.7 8.4 6.3 3.1 -1.3 28.2 4.9 -10.8 2.5 9.3 -15.0 13.3 2.6 4.8 5.8 6.4 -3.6 1.4 -0.9 2.6 -0.1 1.1 0.6 -2.9 -4.2 -0.3 -6.6 -7.4 -3.5 -7.3 -2.7 -3.0 -3.2 0.9 -0.2 1.5 35.1 39.0 37.0 38.3 35.1 47.2 37.9 43.3 47.1 41.0 46.3 33.9 32.2 38.4 37.5 38.7 34.9 45.1 37.1 41.0 - - -12 -12 -16 -15 -18 -18 -19 -21 -22 -21 -17 -16 -16 -13 -14 -14 -13 -13 -12 -12 -13 -12 -6 -8 -10 -10 -13 -12 -15 -16 -16 -14 -10 -11 -8 -8 -9 -5 -3 -4 -4 -4 -5 -3 -40 -40 -45 -44 -43 -40 -37 -41 -42 -40 -36 -30 -31 -30 -26 -20 -20 -22 -15 -16 -17 -17 -9 -5 -8 -6 -10 -11 -14 -16 -20 -19 -15 -13 -13 -11 -9 -14 -14 -11 -9 -13 -13 -10 9 5 8 1 4 -1 -2 7 -8 -5 -2 4 -9 -2 -5 -5 16 16 0 2 12 -7 -26 -26 -39 -33 -36 -36 -36 -45 -39 -37 -34 -31 -31 -26 -27 -37 -37 -37 -33 -31 -35 -35 LABOUR MARKET 2010 2011 2012 2011 2012 2013 2011 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 10 11 12 FORMAL LABOUR FORCE (A=B+E) 935.5 934.7 920.2 931.1 933.3 926.6 923.7 915.2 915.2 912.9 913.8 910.5 935.3 934.5 930.1 PERSONS IN FORMAL EMPLOYMENT (B=C+D)' 835.0 824.0 810.0 823.9 821.7 812.7 816.5 809.1 801.7 789.2 795.0 794.4 824.4 823.4 817.3 In agriculture, forestry, fishing 33.4 38.8 37.0 38.8 38.0 35.2 37.8 37.4 37.4 37.4 38.9 38.1 38.1 38.1 37.9 In industry, construction 287.3 272.9 263.1 272.7 271.0 265.4 266.3 263.1 257.5 249.9 252.5 253.5 273.5 272.1 267.4 Of which: in manufacturing 188.6 184.8 182.9 184.4 186.2 184.6 184.1 182.5 180.4 177.8 177.6 177.5 186.8 186.6 185.1 in construction 78.5 67.8 59.8 67.9 64.4 60.5 61.6 60.1 56.9 52.0 54.6 55.7 66.2 65.0 62.1 In services 514.3 512.3 510.0 512.4 512.7 512.1 512.4 508.6 506.8 502.0 503.6 502.8 512.8 513.2 512.0 Of which: in public administration 52.0 51.4 50.7 51.4 51.3 50.9 51.2 50.8 50.0 49.3 49.3 49.1 51.3 51.4 51.2 in education, health-services, social work 116.7 118.8 120.9 118.5 120.1 120.7 121.6 120.3 121.0 120.7 121.1 120.5 119.8 120.2 120.3 FORMALLY EMPLOYED (C)1 747.2 729.1 717.0 728.9 727.4 720.9 722.7 716.2 708.4 696.1 700.0 699.6 730.1 729.0 723.0 In enterprises and organisations 685.7 671.8 662.6 671.3 670.7 666.4 667.4 661.4 655.1 645.8 648.5 647.9 672.7 671.9 667.6 By those self-employed 61.5 57.2 54.5 57.6 56.6 54.5 55.4 54.8 53.3 50.2 51.5 51.7 57.4 57.0 55.5 SELF-EMPLOYED AND FARMERS (D) 87.8 94.9 93.0 95.0 94.4 91.8 93.8 92.9 93.3 93.1 95.0 94.7 94.3 94.5 94.3 REGISTERED UNEMPLOYMENT (E) 100.5 110.7 110.2 107.2 111.6 114.0 107.2 106.1 113.5 123.7 118.8 116.1 110.9 111.1 112.8 Female 47.9 52.1 52.2 51.1 53.3 53.2 51.0 50.9 53.8 57.0 56.7 57.0 53.5 53.4 53.2 By age: under 26 13.9 12.9 11.9 11.3 13.4 12.7 10.8 10.1 14.0 14.2 13.0 12.3 13.6 13.5 13.2 aged over 50 31.4 39.0 38.2 38.7 38.2 39.2 38.1 37.4 38.1 40.7 39.3 38.1 38.2 37.9 38.4 Unskilled 37.5 39.5 39.4 38.1 39.3 41.0 39.2 37.8 39.5 43.4 40.6 38.8 38.7 39.0 40.1 For more than 1 year 42.8 50.2 55.2 49.6 53.8 57.2 55.1 54.5 53.9 54.4 54.3 55.0 51.8 52.9 56.7 Those receiving benefits 30.0 36.3 33.9 34.9 34.4 37.8 33.2 31.5 33.0 39.3 33.7 30.3 33.9 33.7 35.5 RATE OF REGISTERED UNEMPLOYMENT, E/A, in % 10.7 11.8 12.0 11.5 12.0 12.3 11.6 11.6 12.4 13.5 13.0 12.8 11.9 11.9 12.1 Male 10.1 11.4 11.5 10.9 11.3 11.9 11.1 11.0 11.9 13.4 12.5 11.9 11.1 11.2 11.6 Female 11.6 12.4 12.6 12.3 12.7 12.7 12.3 12.3 13.0 13.8 13.7 13.8 12.7 12.7 12.7 FLOWS OF FORMAL LABOUR FORCE 13.3 2.7 5.3 0.0 5.7 -1.9 -5.2 -0.2 12.6 4.6 -6.0 -1.9 3.9 0.2 1.7 New unemployed first-job seekers 16.8 14.4 16.3 2.7 6.5 2.4 1.9 3.0 9.0 3.7 2.6 3.4 4.4 1.3 0.8 Redundancies 83.5 82.2 90.3 18.7 22.3 22.6 17.9 20.9 28.9 27.1 18.5 19.6 6.9 7.1 8.2 Registered unemployed who found employment 57.0 61.0 58.3 13.4 12.9 17.3 14.0 13.5 13.5 17.2 18.1 15.8 4.4 4.5 4.0 Other outflows from unemployment (net) 29.9 32.8 43.1 8.0 10.2 9.6 11.1 10.7 11.8 9.2 9.1 9.2 3.1 3.8 3.3 WORK PERMITS FOR FOREIGNERS 41.6 35.6 33.9 34.7 34.3 34.2 34.4 33.9 33.2 32.6 31.7 29.8 34.5 34.3 34.2 As % of labour force 4.4 3.8 3.7 3.7 3.7 3.7 3.7 3.7 3.6 3.6 3.5 3.3 3.7 3.7 3.7 Source of data: SURS, PDII, ESS. Note: 'In January 2005, the SORS adopted new methodology of obtaining data on persons in paid employment. The new source of data for employed and self-employed persons excluding farmers is the Statistical Register of Employment (SRE), while data on farmers are forecast using the ARIMA model based on quarterly figures for farmers from the Labour Force Survey. ^According to ESS. 2012 2013 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 927.5 927.1 925.4 926.0 923.7 921.3 917.4 914.5 913.8 918.0 916.5 911.0 913.0 912.9 912.7 914.3 914.0 913.1 911.5 909.8 910.2 811.6 812.0 814.5 816.9 816.9 815.7 810.5 808.4 808.3 807.1 805.0 792.9 788.7 788.9 790.1 793.0 795.4 796.5 794.4 793.2 795.5 35.2 35.1 35.3 37.7 37.8 37.9 37.2 37.4 37.6 37.5 37.4 37.4 37.5 37.3 37.4 38.7 39.0 39.1 38.1 38.1 38.1 265.4 264.7 266.1 266.6 266.6 265.7 264.0 263.2 262.2 261.1 259.5 251.9 249.8 249.5 250.3 251.6 252.6 253.1 253.4 253.1 254.0 184.6 184.6 184.6 184.4 184.2 183.8 182.9 182.5 182.1 181.8 181.2 178.4 177.8 177.8 177.9 177.5 177.7 177.7 177.6 177.3 177.6 60.7 59.9 61.0 61.7 61.8 61.4 60.5 60.2 59.6 59.0 58.1 53.5 52.0 51.8 52.4 54.0 54.8 55.2 55.5 55.5 56.0 510.9 512.2 513.1 512.6 512.5 512.1 509.3 507.9 508.5 508.5 508.1 503.7 501.4 502.1 502.4 502.6 503.8 504.3 502.9 502.0 503.4 50.8 50.9 50.9 51.1 51.2 51.2 50.8 50.8 50.7 50.2 50.2 49.6 49.2 49.4 49.2 49.3 49.3 49.4 49.1 49.2 48.9 119.9 120.8 121.5 121.6 121.7 121.4 120.3 119.8 120.8 121.1 121.3 120.6 120.4 120.8 121.0 120.9 121.2 121.3 120.3 120.0 121.2 719.6 720.3 722.7 723.0 723.1 722.1 717.7 715.6 715.2 713.7 711.6 699.9 695.5 695.8 696.9 698.2 700.3 701.5 699.8 698.6 700.5 665.2 666.1 667.9 667.7 667.7 666.7 662.8 660.9 660.5 659.2 657.7 648.3 645.3 645.8 646.4 647.0 648.7 649.7 648.0 647.0 648.6 54.5 54.2 54.8 55.3 55.4 55.3 55.0 54.7 54.7 54.5 53.9 51.6 50.3 50.0 50.5 51.1 51.5 51.8 51.8 51.6 51.9 91.9 91.8 91.8 93.9 93.8 93.6 92.8 92.8 93.1 93.4 93.4 93.1 93.2 93.0 93.2 94.8 95.1 95.0 94.6 94.6 95.0 116.0 115.0 110.9 106.8 106.8 105.6 106.9 106.1 105.4 110.9 111.5 118.1 124.3 124.1 122.6 121.3 118.6 116.6 117.1 116.6 114.7 54.2 53.4 52.0 51.7 50.9 50.5 51.2 50.9 50.5 53.3 53.3 54.9 57.2 56.9 56.9 57.3 56.7 56.2 57.3 57.4 56.5 13.2 12.9 12.0 11.4 10.7 10.3 10.2 10.1 10.1 14.2 14.0 13.8 14.4 14.4 13.8 13.1 13.1 12.6 12.5 12.2 12.1 39.6 39.4 38.6 38.5 38.1 37.7 37.9 37.4 37.1 37.0 37.1 40.2 41.2 40.9 40.1 39.5 39.5 38.9 38.6 38.3 37.5 41.4 41.6 40.0 40.0 39.0 38.4 38.2 37.7 37.5 38.3 38.7 41.6 43.6 43.8 42.8 41.8 40.5 39.6 39.2 38.9 38.4 58.0 57.3 56.3 55.4 55.0 54.7 54.6 54.6 54.3 54.3 53.6 53.8 54.7 54.4 54.2 54.6 54.4 53.9 54.7 54.5 55.7 38.5 38.3 36.7 34.2 33.4 31.9 32.1 31.4 31.2 31.5 31.9 35.6 40.3 39.2 38.4 35.8 33.9 31.4 31.0 30.5 29.4 12.5 12.4 12.0 11.8 11.6 11.5 11.7 11.6 11.5 12.1 12.2 13.0 13.6 13.6 13.4 13.3 13.0 12.8 12.9 12.8 12.6 12.1 12.1 11.6 11.3 11.0 10.9 11.0 11.0 10.9 11.4 11.6 12.7 13.4 13.5 13.2 12.8 12.4 12.1 12.0 11.9 11.7 13.0 12.8 12.5 12.4 12.2 12.2 12.4 12.4 12.3 12.9 12.9 13.3 13.8 13.8 13.7 13.8 13.6 13.5 13.8 13.9 13.6 3.2 -0.9 -4.2 -1.8 -2.3 -1.2 1.3 -0.8 -0.6 5.4 0.6 6.6 6.2 -0.2 -1.4 -1.3 -2.8 -2.0 0.5 -0.5 -1.9 0.8 0.7 0.8 0.7 0.6 0.6 0.8 0.8 1.4 6.3 1.8 0.9 1.5 1.1 1.1 1.1 0.8 0.8 1.0 0.9 1.5 10.6 6.1 5.9 6.5 5.8 5.6 8.0 5.6 7.3 8.4 8.2 12.2 14.2 6.3 6.6 7.1 6.1 5.3 7.7 5.5 6.4 5.0 5.2 7.1 5.5 4.7 3.9 4.0 4.0 5.5 4.9 5.1 3.4 6.2 4.8 6.2 6.3 6.5 5.3 5.3 4.1 6.4 3.3 2.6 3.7 3.5 4.1 3.5 3.5 3.3 3.8 4.3 4.3 3.2 3.4 2.8 3.0 3.1 3.2 2.7 2.9 2.9 3.4 34.2 34.2 34.2 34.7 34.4 34.1 33.8 33.9 33.9 33.6 33.3 32.7 32.9 32.8 32.2 32.3 32.0 31.0 30.4 29.8 29.3 3.7 3.7 3.7 3.7 3.7 3.7 3.7 3.7 3.7 3.7 3.6 3.6 3.6 3.6 3.5 3.5 3.5 3.4 3.3 3.3 3.2 WAGES AND INDICATORS OF OVERALL COMPETITIVENESS 2010 2011 2012 2011 2012 2013 2011 2012 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 11 12 1 GROSS WAGE PER EMPLOYEE, y-o-y growth rates, % Activity - Total 3.9 2.0 0.1 1.7 1.1 1.6 0.3 -0.7 -1.0 -1.0 -0.5 0.3 1.1 0.8 2.2 A Agriculture, forestry and fishing 5.7 3.1 -1.1 1.1 0.4 0.1 -1.0 -1.5 -2.0 -0.8 1.1 0.0 4.1 -3.5 2.1 B Mining and quarrying 4.0 3.9 3.6 5.8 5.9 8.4 10.6 2.2 -5.2 4.1 -6.8 -2.9 2.2 6.8 10.0 C Manufacturing 8.9 3.9 2.5 3.5 3.1 3.4 2.5 2.0 2.3 1.6 2.9 3.0 4.6 1.8 4.5 D Electricity, gas, steam and air conditioning supply 3.8 2.3 3.3 3.5 -0.5 5.6 3.9 4.9 -0.5 6.2 2.8 3.6 -8.1 5.6 5.5 E Water supply sewerage, waste management and remediation activities 2.2 -0.1 0.1 1.1 -2.7 2.1 -0.5 0.4 -1.4 0.3 0.1 1.0 -7.5 -1.3 3.1 F Constrution 4.5 1.9 -2.5 0.3 0.5 -0.3 -2.8 -2.8 -3.8 -2.4 -2.1 0.1 2.3 -0.5 1.1 G Wholesale and retail trade, repair of motor vehicles and motorcycles 3.7 2.8 0.8 2.3 3.0 2.1 1.6 0.0 -0.3 -0.2 0.0 0.6 4.3 2.4 3.3 H Transportation and storage 2.0 2.7 -0.4 3.9 1.6 2.2 0.6 -1.7 -2.3 -1.1 0.2 -0.9 0.8 0.8 3.7 I Accommodation and food service activities 4.0 2.1 -0.8 2.0 -0.6 -0.4 -0.7 -1.0 -1.1 -1.3 -0.7 -0.6 -1.9 -0.3 0.2 J Information and communication 2.6 0.9 -0.4 1.8 -0.2 0.3 1.3 -1.2 -2.0 -0.6 -2.7 -1.1 -0.4 -1.3 0.1 K Financial and insurance activities 1.0 0.7 1.1 0.8 -2.4 4.5 -1.7 2.2 -0.3 -2.1 1.2 1.2 -6.2 0.5 1.5 L Real estate activities 2.9 3.0 -0.6 3.4 1.6 1.1 -1.3 -0.6 -1.3 -1.1 0.2 -0.6 1.0 2.0 2.3 M Professional, scientific and technical activities 1.6 -0.4 -1.1 -0.6 -1.6 -0.5 -0.8 -1.7 -1.3 -2.2 -3.4 -1.5 -2.9 -2.3 0.0 N Administrative and support service activities 4.0 3.5 0.7 3.9 2.7 3.0 0.3 -0.9 0.2 -2.4 0.7 0.7 3.2 2.5 2.1 O Public administration and defence, compulsory social security -0.6 0.3 -1.8 -0.1 -0.4 -0.2 -1.5 -3.2 -2.4 -2.4 -2.1 -0.6 0.2 -0.1 0.6 P Education 0.6 0.2 -3.3 -0.3 0.4 -0.3 -2.2 -5.0 -5.6 -5.4 -4.2 -2.0 -0.4 0.5 0.1 Q Human health and social work activities -0.3 -0.7 -1.3 -0.5 -0.5 -0.5 -1.0 -1.7 -2.1 -2.3 -2.3 -2.2 -0.4 -0.5 -0.5 R Arts, entertainment and recreation 0.5 -0.7 -2.8 -1.0 -0.3 -0.6 -1.5 -4.4 -4.6 -5.7 -3.8 -1.4 -1.6 -0.8 -1.3 S Other service activities 4.2 0.9 -0.9 0.6 -1.1 0.5 -0.6 -1.0 -2.4 -0.6 -0.7 -1.1 -1.6 -1.8 2.0 INDICATORS OF OVERALL COMPETITIVENESS1, y-o-y growth rates, % Effective exchange rate,2 nominal -2.1 -0.1 -1.2 0.4 0.1 -0.5 -1.3 -1.8 -1.4 0.2 0.6 1.6 0.2 0.1 -0.1 Real (deflator HICP) -1.8 -1.0 -1.1 -1.2 -0.5 -0.9 -1.3 -1.2 -0.8 0.9 0.8 2.3 -0.3 -0.7 -0.9 Real (deflator ULC) -1.6 -2.3 -3.0 -2.1 -2.8 -1.9 -3.3 -3.7 -3.0 -2.5 -1.3 USD/EUR 1.3268 1.3917 1.2856 1.4126 1.3480 1.3110 1.3196 1.2515 1.2974 1.3204 1.3066 1.3246 1.3556 1.3179 1.2905 Source of data: SURS, ECB; calculations by IMAD. Note: 1 Change of the source for effective exchange rate series as of April 2012: a new source, ECB; before that, own calculations (IMAD). 2 Harmonised effective exchange rate - a group of 20 EU Member States and 17 euro area countries; an increase in value indicates appreciation of the national currency and vice versa. 2012 2013 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 2.0 0.7 1.0 1.3 -1.3 -0.1 -0.7 -1.2 0.4 -2.4 -0.7 -0.3 -1.7 -1.0 -0.2 -0.8 -0.4 0.8 -0.4 0.4 0.3 -2.1 -0.1 -0.5 -2.5 1.3 -1.9 -3.9 2.5 -5.9 -2.0 1.8 -4.6 0.2 0.6 1.5 1.1 2.2 -3.6 1.5 11.9 3.8 4.0 14.9 13.2 1.4 5.4 -0.2 1.5 1.7 -18.0 10.4 0.6 1.1 -5.4 -10.3 -4.8 -1.8 -4.9 -1.8 3.8 1.9 2.7 3.9 1.0 4.3 1.3 0.3 5.2 0.5 1.4 3.5 0.3 1.1 4.4 2.3 2.0 3.4 2.0 3.7 8.0 3.6 5.2 6.5 0.3 4.0 2.6 8.3 7.8 -6.6 -0.5 5.0 2.6 10.9 6.6 0.7 1.3 10.0 3.1 -2.1 2.8 0.5 0.4 0.7 -2.5 4.0 -0.1 -2.6 2.2 -7.0 1.5 2.7 -1.1 -0.8 1.6 -0.2 -1.1 -0.5 1.7 1.7 1.4 -3.1 -1.3 -0.4 -6.6 -1.4 -1.9 -5.1 0.2 -6.8 -4.6 -1.2 -3.0 -2.9 -2.2 -3.2 -0.9 1.1 -1.7 0.9 2.2 1.0 2.9 1.8 0.0 0.7 0.5 -1.0 0.5 -0.8 -0.6 -0.6 -0.5 0.4 -0.5 0.6 -0.1 1.1 -0.4 1.1 0.8 2.0 1.5 2.1 -1.9 -6.3 -1.3 2.7 -1.1 -3.9 -1.6 -1.1 -1.4 -0.8 0.7 0.3 -0.4 1.7 0.3 -4.7 0.4 -1.7 -1.4 0.5 -1.2 -0.1 -1.1 -1.9 -0.9 -0.9 -1.4 -2.4 -1.3 -0.2 0.1 -0.6 -1.7 -0.7 -1.0 -0.1 0.2 0.5 2.3 1.7 -0.1 0.8 -1.2 -3.1 0.1 -7.1 1.6 -1.1 -0.5 -0.1 -4.3 -1.9 -1.9 -0.8 -1.8 -0.6 8.4 3.8 -0.4 -4.4 -0.2 1.8 1.8 3.0 3.5 -4.0 0.3 -1.0 -3.6 -1.6 0.4 3.5 -0.1 4.0 -1.4 1.0 2.5 -1.5 -0.1 -1.3 -2.4 0.1 -1.0 -1.1 0.1 -2.3 -1.6 -0.4 -2.1 -0.7 -0.2 0.6 0.2 -0.3 -1.4 0.0 -0.5 -1.1 -0.7 1.0 -2.7 -0.8 -1.9 -2.4 -0.9 -1.9 -1.0 -0.3 -3.5 -2.8 -3.0 -4.1 -3.0 -2.3 -2.4 0.3 5.1 2.0 -0.2 1.7 -0.6 -0.1 0.0 -2.5 1.4 -1.1 0.5 -0.5 -4.3 -2.3 1.4 0.0 0.9 0.8 0.2 1.3 -0.4 -0.7 -0.7 -0.3 -3.5 -3.4 -3.3 -2.9 -2.9 -2.6 -1.6 -1.7 -2.9 -2.6 -2.2 -3.0 -1.0 -0.4 -0.8 -0.6 -0.6 -0.5 -1.5 -0.4 -4.6 -4.8 -5.0 -5.2 -5.8 -5.8 -5.3 -5.9 -5.0 -5.4 -4.2 -5.8 -2.5 -2.4 -2.2 -1.3 -0.4 -0.6 -0.3 -1.0 -1.6 -2.2 -2.0 -1.0 -2.8 -3.0 -0.4 -2.7 -2.5 -1.6 -3.0 -2.1 -1.7 -2.2 -1.8 -2.4 -1.9 1.3 -0.9 0.0 -3.5 -4.1 -3.6 -5.4 -6.3 -3.9 -3.7 -4.7 -4.7 -7.5 -4.0 -3.2 -4.2 -0.7 -2.6 -0.9 -0.4 0.0 -0.6 0.1 -1.2 -0.1 -2.2 -0.7 -1.2 -4.0 -1.9 -0.8 -0.1 -0.7 1.0 -1.2 -1.9 -0.8 -1.2 -1.2 -0.4 -0.9 -1.2 -1.2 -1.5 -1.8 -2.1 -1.5 -1.6 -1.7 -0.9 0.1 0.4 0.1 0.2 0.4 1.1 1.6 2.0 1.3 -0.6 -1.3 -1.1 -1.4 -1.5 -1.5 -1.5 -0.5 -1.0 -1.3 -0.2 0.8 1.3 0.5 0.4 0.4 1.6 2.7 2.7 1.3 1.3224 1.3201 1.3162 1.2789 1.2526 1.2288 1.2400 1.2856 1.2974 1.2828 1.3119 1.3288 1.3359 1.2964 1.3026 1.2982 1.3189 1.3080 1.3310 1.3348 PRICES 2010 2011 2012 2011 2012 2013 2011 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 8 9 10 11 12 CPI, y-o-y growth rates, % 1.8 1.8 2.6 1.3 2.5 2.5 2.5 2.9 2.6 2.3 1.5 2.1 0.9 2.1 2.7 2.7 2.0 Food, non-alcoholic beverages 1.0 4.4 4.1 3.7 5.1 3.9 4.2 3.9 4.4 4.4 3.6 4.1 3.8 4.4 5.6 4.8 4.9 Alcoholic beverages, tobacco 7.2 5.7 6.5 3.7 4.9 4.2 5.1 7.2 9.5 10.6 7.5 7.4 2.8 3.0 4.8 4.9 4.9 Clothing and footwear -1.9 -1.5 -0.2 -4.2 0.9 -2.2 1.6 0.7 -0.8 2.1 -1.2 1.0 -4.9 -3.4 2.0 2.1 -1.5 Housing, water, electricity, gas 10.2 5.6 3.8 4.8 5.4 4.9 4.2 4.4 1.8 2.1 2.9 2.8 4.9 5.1 5.5 5.7 5.0 Furnishings, household equipment 1.4 2.7 0.1 2.4 1.7 1.2 0.0 -0.1 -0.9 -1.1 -1.8 -1.2 1.7 2.1 1.8 2.0 1.4 Medical, pharmaceutical products 2.1 1.6 0.4 0.8 0.3 -0.2 1.4 0.2 0.3 -0.2 -2.1 0.4 0.8 0.5 0.5 0.2 0.0 Transport -0.3 1.0 3.3 1.1 1.7 2.6 3.2 3.9 3.5 1.5 -0.5 0.5 1.1 2.0 1.9 1.9 1.4 Communications 1.4 1.2 -2.4 2.3 -1.8 -1.2 -2.9 -3.6 -2.0 -3.8 -1.9 1.2 2.5 0.9 -1.8 -0.3 -3.3 Recreation and culture 0.4 -1.5 1.4 -1.7 -0.8 2.6 1.2 1.2 0.4 -0.3 -0.5 0.6 -2.0 -1.2 -0.3 -0.9 -1.2 Education 1.6 1.7 2.9 1.9 1.4 1.1 1.3 4.3 4.8 4.6 4.6 1.4 1.6 2.5 1.8 0.9 1.6 Catering services -2.5 -6.8 4.5 -6.2 2.0 2.3 2.5 3.7 9.4 9.2 8.8 7.0 -9.8 2.7 2.0 2.0 2.2 Miscellaneous goods & services 1.4 2.2 2.4 2.4 2.6 2.5 1.2 3.3 2.8 2.4 2.7 0.5 2.3 2.7 2.4 2.5 2.8 HCPI 2.1 2.1 2.8 1.5 2.6 2.5 2.5 3.2 3.0 2.7 1.8 2.2 1.2 2.3 2.9 2.8 2.1 Core inflation (excluding fresh food and energy) 0.3 1.3 2.0 1.2 2.3 2.2 1.8 2.0 1.9 1.9 1.4 1.9 0.8 1.9 2.3 2.5 2.1 PRODUCER PRICE INDICES, y-o-y growth rates, % Total 2.1 4.5 0.9 4.1 3.6 1.3 0.8 0.6 0.6 0.8 0.2 -0.2 4.2 4.1 3.7 3.6 3.6 Domestic market 2.0 3.8 1.0 3.7 2.9 1.1 0.9 0.9 1.2 1.1 0.3 0.1 3.8 3.6 3.1 2.9 2.6 Non-domestic market 2.2 5.3 0.7 4.6 4.4 1.6 0.7 0.4 0.1 0.4 0.2 -0.6 4.6 4.6 4.3 4.3 4.5 euro area 2.2 6.1 0.1 5.1 4.6 0.8 0.2 0.1 -0.5 0.4 0.0 -0.7 5.2 5.2 4.4 4.7 4.7 non-euro area 2.1 3.6 2.0 3.5 3.8 3.4 2.0 1.3 1.5 0.6 0.7 -0.3 3.2 3.2 4.1 3.5 4.0 Import price indices 7.4 5.4 1.9 4.5 2.9 1.9 1.2 1.3 3.2 0.8 -0.5 -0.3 4.8 4.3 4.1 3.0 1.8 PRICE CONTROL,1 y-o-y growth rates, % Energy prices 16.5 10.9 12.7 8.3 10.8 12.1 12.5 14.5 11.6 5.6 0.1 -0.7 9.1 9.6 10.8 11.9 9.7 Oil products 17.3 11.9 13.0 9.9 11.7 12.3 12.7 14.4 12.6 6.4 0.4 0.4 10.8 11.3 12.3 12.7 10.3 Transport & communications 1.8 1.1 1.6 1.1 1.1 0.7 0.0 0.0 5.7 8.6 8.6 17.3 1.1 1.1 1.1 1.1 1.1 Other controlled prices 1.3 0.0 -0.6 0.0 -0.2 -0.2 -0.3 0.1 -1.8 -3.9 -2.9 -0.8 0.0 0.0 -0.2 -0.2 -0.2 Direct control - total 14.2 2.8 9.2 0.5 2.1 7.3 9.5 11.0 8.9 4.3 0.5 1.0 1.1 1.4 2.2 2.9 1.3 Source of data: SURS; calculations by IMAD. Note: 1 The structure of groups varies. Data for individual years are not fully comparable to those published previously. On 1 July 2007, the electricity market was liberalised. Since July 2007, the data are not comparable. 2 After a longer period of unchanged prices, at the beginning of 2013, the Decree on the pricing of mandatory local public services in the field of environmental protection (Official Gazette of the RS, No. 87/2012) transferred the responsibility for approving price changes to local communities. 2012 2013 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 2.3 2.9 2.3 2.6 2.4 2.3 2.4 2.9 3.3 2.7 2.3 2.7 2.4 2.7 2.0 1.5 1.2 1.9 2.6 2.2 1.4 1.3 3.9 3.9 4.0 4.7 4.3 3.7 4.1 3.7 4.0 4.3 4.2 4.7 5.2 4.1 3.9 3.3 3.1 4.4 4.4 4.3 3.5 2.4 4.1 3.9 4.7 5.1 5.2 5.1 7.4 7.1 7.0 9.6 9.5 9.4 11.2 10.7 10.0 7.8 7.4 7.5 7.5 7.5 7.1 3.0 -2.2 -3.5 -1.2 0.2 3.0 1.6 0.8 1.8 -0.3 -1.5 -1.7 0.8 1.6 6.5 -1.3 0.0 -3.1 -0.5 1.1 0.1 1.7 0.3 4.7 5.3 4.7 4.0 3.7 4.9 3.9 4.2 5.2 2.7 1.5 1.3 0.7 2.8 2.9 3.3 2.8 2.5 3.4 2.7 2.1 3.9 1.3 1.5 0.8 0.7 0.1 -0.7 -0.3 0.1 -0.2 -0.8 -1.2 -0.7 -0.5 -1.5 -1.1 -2.2 -1.9 -1.4 -1.3 -0.8 -1.5 -0.4 -0.3 -0.3 0.1 1.5 1.5 1.3 0.1 0.2 0.3 0.3 0.4 0.2 -0.1 0.2 -0.7 -2.0 -2.1 -2.2 0.0 0.3 0.7 0.0 2.0 2.5 3.3 4.1 2.8 2.6 2.4 4.5 4.7 3.9 3.3 3.4 2.0 1.9 0.6 -0.9 -0.9 0.2 2.0 0.0 -0.4 -0.6 -0.1 -1.2 -2.4 -2.6 -3.2 -2.8 -3.1 -4.4 -3.2 -1.6 -3.3 -1.1 -3.6 -4.6 -3.2 -2.2 -2.3 -1.3 0.0 2.5 1.1 1.6 0.8 6.8 0.4 0.9 1.2 1.6 1.3 1.2 1.2 0.1 0.9 0.2 -0.4 -0.4 -0.1 -0.4 -0.5 -0.6 0.7 0.9 0.2 0.9 1.0 1.1 1.2 1.3 1.3 1.3 1.3 5.9 5.7 4.8 5.0 4.7 4.6 4.7 4.7 4.6 4.6 4.6 4.6 0.1 -0.5 0.1 2.5 2.4 2.1 2.8 2.6 2.1 1.4 0.9 8.9 9.1 9.7 9.3 9.3 9.2 9.0 8.6 8.6 9.1 9.6 9.9 2.0 2.0 2.9 2.7 1.9 1.9 1.1 0.6 2.5 3.7 3.7 3.1 2.9 2.4 2.4 2.5 2.4 2.1 2.9 3.1 1.2 0.2 0.1 0.7 2.3 2.8 2.4 2.9 2.4 2.4 2.6 3.1 3.7 3.2 2.8 3.1 2.8 2.9 2.2 1.6 1.6 2.2 2.8 2.2 1.5 1.1 2.4 2.6 1.6 1.9 1.9 1.7 1.9 2.0 2.0 1.9 1.8 2.0 1.9 2.2 1.6 1.4 1.3 1.5 2.0 2.1 1.7 1.6 2.4 0.8 0.7 0.7 1.0 0.7 0.8 0.4 0.7 0.8 0.7 0.4 0.4 1.1 0.8 0.5 0.2 0.0 -0.3 0.0 -0.4 -0.5 1.9 0.7 0.6 0.7 1.3 0.8 0.9 0.8 0.9 1.2 1.3 1.0 1.1 1.1 1.1 0.6 0.1 0.1 0.1 0.2 0.1 -0.2 3.0 0.9 0.8 0.8 0.8 0.5 0.6 0.1 0.6 0.4 0.1 -0.2 -0.3 1.0 0.5 0.5 0.3 -0.2 -0.6 -0.2 -0.9 -0.9 2.8 -0.1 -0.2 0.0 0.4 0.1 0.5 -0.5 0.2 -0.1 -0.6 -0.8 -0.8 1.2 0.7 0.3 0.0 -0.4 -0.8 -0.3 -1.0 -1.0 3.5 3.3 3.4 2.8 1.7 1.4 1.0 1.3 1.6 1.7 1.8 1.1 1.0 0.6 0.2 0.8 1.1 0.3 -0.3 0.0 -0.6 -0.4 0.9 2.1 2.8 2.0 1.2 0.3 0.1 1.1 2.7 2.9 3.7 3.0 2.1 0.6 -0.3 -0.6 -1.3 0.5 1.2 -0.4 -1.6 -1.5 10.3 12.0 13.8 14.7 11.8 10.9 10.1 14.6 18.8 14.7 10.4 9.8 7.5 6.4 2.9 -0.6 -0.7 1.8 3.8 -1.3 -4.2 -5.9 10.5 12.2 14.2 15.3 11.9 10.8 9.2 14.4 19.4 15.8 11.4 10.5 8.1 7.7 3.6 -0.8 -0.9 3.1 5.5 -0.3 -3.5 -2.4 1.1 1.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 8.6 8.6 8.6 8.6 8.6 8.6 8.6 8.6 17.3 17.3 17.3 17.3 -0.2 -0.2 -0.3 -0.3 -0.3 -0.3 0.1 0.1 0.1 -3.0 -1.1 -1.1 -3.9 -3.9 -3.9 -3.8 -3.8 -1.1 -0.8 -0.8 -0.8 2.7 2.0 9.5 10.6 11.1 9.0 8.5 7.9 11.0 14.0 10.1 8.5 8.1 5.6 4.9 2.4 -0.1 -0.3 2.0 4.3 0.5 -1.6 -1.4 BALANCE OF PAYMENTS 2010 2011 2012 2011 2012 2013 2011 Q^ Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 9 10 11 12 BALANCE OF PAYMENTS, in EUR m Current account -50 146 1,159 -47 0 96 262 320 482 484 702 681 17 84 7 -91 Goods1 -830 -957 -110 -194 -356 -149 -45 60 24 132 250 251 -91 -39 -106 -211 Exports 18,973 21,450 21,631 5,285 5,403 5,364 5,559 5,283 5,424 5,392 5,660 5,449 1,942 1,849 1,913 1,641 Imports 19,804 22,407 21,741 5,479 5,758 5,514 5,604 5,223 5,400 5,260 5,410 5,198 2,033 1,888 2,019 1,851 Services 1,281 1,476 1,803 377 375 418 444 528 414 505 538 626 155 152 127 97 Exports 4,593 4,842 5,166 1,393 1,217 1,118 1,237 1,502 1,310 1,205 1,316 1,609 461 414 381 421 Imports 3,312 3,365 3,363 1,016 841 700 793 974 896 700 779 983 305 263 254 325 Income -588 -524 -552 -235 -81 -145 -168 -198 -42 -73 -108 -125 -55 -29 -37 -14 Receipts 583 936 699 221 259 131 188 174 206 223 206 198 82 81 78 100 Expenditure 1,172 1,460 1,251 456 340 276 356 372 247 296 314 323 137 110 115 114 Current transfers 88 151 18 4 62 -28 31 -70 86 -80 22 -71 8 0 24 38 Receipts 1,231 1,404 1,410 319 371 348 366 285 411 332 356 290 125 96 117 158 Expenditure 1,143 1,253 1,392 315 310 377 336 355 325 412 334 361 118 96 94 120 Capital and financial account 530 -474 -1,206 -81 -175 67 -249 -540 -484 -928 -810 -917 -94 -297 -53 176 Capital account 54 -85 -92 -3 -80 -24 11 -30 -49 -5 -40 -33 5 0 11 -91 Financial account 476 -389 -1,114 -78 -94 91 -260 -511 -434 -922 -770 -884 -99 -297 -64 267 Direct investment 428 633 166 260 151 146 98 84 -162 -61 -649 -9 123 -83 -51 285 Domestic abroad 156 -85 212 54 -156 41 127 39 5 -110 52 -1 57 -77 3 -83 Foreign in Slovenia 272 718 -46 206 307 105 -29 45 -167 49 -700 -7 66 -6 -54 367 Portfolio investment 1,956 1,839 -218 -441 -20 -923 124 -982 1,564 132 2,101 -422 -448 225 -179 -66 Financial derivatives -117 -155 -203 -28 -24 -23 -21 -31 -129 23 -229 -117 -21 -8 2 -18 Other investment -1,810 -2,777 -890 98 -221 851 -455 439 -1,726 -1,084 -1,973 -253 218 -417 120 76 Assets 779 -1,490 -1,474 -363 567 -1,466 -95 205 -118 -1,333 -685 73 166 -361 301 628 Commercial credits -174 -49 65 44 316 -347 -35 109 339 -368 -50 83 -118 -135 42 409 Loans 203 -55 -319 48 19 3 -95 84 -310 26 -180 89 41 -48 23 44 Currency and deposits 669 -1,341 -1,177 -422 249 -1,131 11 -33 -24 -974 -381 -112 244 -187 233 203 Other assets 81 -46 -45 -33 -18 10 24 45 -124 -17 -73 14 -1 9 3 -29 Liabilities -2,589 -1,287 584 461 -788 2,317 -359 234 -1,608 249 -1,288 -326 51 -56 -181 -551 Commercial credits 362 107 265 -82 17 161 136 -96 63 -301 92 -203 178 -20 133 -96 Loans -986 -1,234 -729 203 -752 -121 -223 -178 -208 374 602 -537 5 -201 -429 -121 Deposits -1,954 -169 1,026 340 -57 2,287 -288 530 -1,503 188 -1,981 429 -99 158 103 -319 Other liabilities -11 9 23 0 3 -11 17 -22 39 -12 -2 -15 -33 7 12 -15 International reserves2 19 72 31 33 19 39 -6 -21 19 67 -19 -83 29 -15 44 -10 Statistical error -480 328 47 128 174 -163 -13 220 2 443 108 236 77 214 46 -85 EXPORTS AND IMPORTS BY END-USE OF PRODUCTS, in EUR m Export of investment goods 1,875 2,042 2,112 514 540 477 569 514 552 516 525 N/A 176 175 179 186 Intermediate goods 10,172 12,008 12,138 3,024 2,931 3,063 3,101 3,019 2,955 3,078 3,185 N/A 1,100 1,037 1,058 837 Consumer goods 6,592 6,950 6,811 1,631 1,803 1,685 1,734 1,604 1,788 1,676 1,832 N/A 627 597 632 573 Import of investment goods 2,324 2,505 2,402 589 736 562 584 570 687 645 664 N/A 219 203 226 307 Intermediate goods 12,247 14,107 14,005 3,472 3,490 3,636 3,578 3,410 3,382 3,478 3,467 N/A 1,283 1,209 1,262 1,018 Consumer goods 5,530 5,943 5,671 1,502 1,524 1,435 1,400 1,350 1,486 1,394 1,487 N/A 552 504 537 483 Source of data: BS, SURS. Note: 'Exports and imports (F.O.B.) include also the adjustment for exports and imports of goods by ITRS and duty-free shops reports. 2Reserve assets of the BS. 2012 2013 1 2 3 4 5 6 7 8 9 10 11 12 12 3 4 5 6 7 8 9 -23 -76 195 89 23 150 59 61 200 196 230 56 62 81 341 298 142 262 251 161 269 -115 -39 4 7 -31 -21 48 -73 84 43 98 -117 -50 59 124 136 -15 129 142 20 89 1,646 1,726 1,992 1,807 1,862 1,891 1,829 1,606 1,848 1,961 1,926 1,537 1,716 1,740 1,936 1,965 1,851 1,844 1,965 1,554 1,930 1,761 1,765 1,988 1,800 1,892 1,912 1,781 1,679 1,764 1,918 1,828 1,654 1,766 1,681 1,812 1,829 1,866 1,714 1,822 1,535 1,841 152 106 161 148 156 140 147 189 192 183 145 86 168 123 214 172 186 180 193 202 231 377 325 417 392 410 434 512 512 477 467 415 427 389 352 464 429 436 452 530 531 548 225 219 256 244 254 295 366 323 285 284 270 341 221 229 250 257 250 272 337 329 317 -35 -41 -68 -44 -99 -25 -110 -32 -56 -8 -14 -19 -26 -24 -23 -30 -40 -37 -40 -42 -43 41 42 48 54 63 72 54 55 65 58 59 88 74 73 76 69 69 69 69 64 65 77 83 116 98 162 97 164 87 121 66 73 108 100 97 99 99 109 106 110 106 108 -25 -101 98 -23 -3 56 -25 -24 -21 -21 1 106 -30 -76 26 21 11 -10 -44 -18 -8 73 68 207 97 113 156 112 85 88 90 109 212 86 95 151 139 115 102 100 91 98 97 169 110 120 116 100 137 109 109 112 108 106 116 171 125 118 104 112 145 110 106 87 152 -172 -168 -162 81 -55 -243 -242 -384 -348 248 -418 -99 -411 -342 -172 -296 -255 -314 -347 -4 -6 -14 24 5 -18 9 -10 -29 -13 -40 3 -1 -5 0 0 -27 -13 4 -12 -24 90 158 -158 -193 -167 100 -65 -233 -213 -372 -308 245 -417 -94 -411 -342 -145 -283 -259 -302 -323 -53 77 123 -92 144 45 87 -28 25 -45 31 -149 51 27 -139 -701 -4 56 50 2 -60 -12 17 36 -6 53 80 13 43 -16 -6 42 -32 -9 -6 -95 -8 22 38 -4 -2 5 -41 60 87 -86 91 -35 74 -71 41 -39 -11 -117 60 32 -43 -693 -25 18 54 4 -65 221 -820 -324 76 133 -86 -644 -152 -187 1,674 -54 -56 -156 17 271 -143 2,589 -346 -129 -90 -203 0 9 -31 -6 -7 -7 -9 -3 -19 -44 -40 -44 -34 65 -8 -8 -68 -153 -83 -55 21 -10 834 27 -171 -435 151 541 -46 -56 -1,982 -256 512 -301 -214 -569 494 -2,688 221 -15 -161 -77 -612 102 -956 -383 119 169 122 147 -64 -294 -422 597 -358 -386 -589 -237 -420 -27 -24 186 -89 -86 -85 -176 24 -32 -27 16 158 -65 -28 37 330 -68 -84 -217 -26 55 -79 -3 186 -100 22 128 -147 -153 -28 86 40 51 -8 17 -49 -277 4 9 13 -71 -68 -41 11 75 4 -544 42 -629 -258 164 105 36 -77 8 -132 -406 514 -290 -312 -372 -70 -414 103 -31 -83 1 -3 17 -4 4 15 5 30 15 0 -151 -4 31 -5 1 -13 -69 6 -10 -1 8 7 602 732 983 212 -554 -18 419 -193 8 -1,688 166 -85 57 172 20 731 -2,268 248 9 -347 11 -79 147 93 -16 -72 224 -8 -144 56 6 18 40 -233 86 -154 -2 34 60 -124 -141 62 77 -211 14 103 -213 -114 -83 -62 -32 14 -194 -28 34 -151 492 675 -14 -59 -383 44 -198 550 833 904 115 -278 -126 527 12 -9 -1,726 358 -136 274 234 -319 68 -2,299 251 524 -250 155 54 -36 -29 10 9 -2 -17 1 -6 18 -17 38 -18 3 2 -10 12 -4 -7 0 -8 -68 59 48 0 -2 -4 -41 -3 23 26 11 -18 22 11 33 17 25 -61 -82 3 -4 -64 -76 -23 80 139 -231 -4 182 42 188 118 -304 356 18 70 44 30 34 5 153 78 144 159 175 183 189 196 172 164 179 193 191 168 155 159 202 180 176 169 200 143 N/A 957 996 1,110 1,009 1,049 1,042 1,052 935 1,032 1,116 1,062 777 1,007 988 1,083 1,110 1,054 1,021 1,116 919 N/A 500 528 657 559 572 603 554 460 590 610 628 550 506 557 612 635 583 615 607 458 N/A 174 159 228 186 201 197 217 163 190 219 209 259 195 196 254 218 259 187 201 149 N/A 1,171 1,171 1,294 1,177 1,209 1,192 1,175 1,096 1,140 1,244 1,160 978 1,223 1,110 1,144 1,201 1,202 1,064 1,179 985 N/A 447 456 533 449 475 475 442 447 461 530 508 448 444 467 483 491 489 506 511 445 N/A MONETARY INDICATORS AND INTEREST RATES 2010 2011 2012 2011 2012 6 1 7 1 8 1 9 1 10 1 11 1 12 1 1 2 1 3 1 4 SELECTED CLAIMS OF OTHER MFI ON DOMESTIC SECTORS, end of the month, in EUR m Claims of the BS on central government 138 102 221 76 76 76 77 76 83 102 111 119 182 169 Central government (S. 1311) 3,419 4,299 5,057 3,282 3,276 3,328 3,355 3,387 3,436 4,299 4,465 4,580 4,801 4,752 Other government (S. 1312, 1313, 1314) 526 584 610 533 534 536 535 541 554 584 588 589 588 591 Households (S. 14, 15) 9,282 9,454 9,267 9,425 9,507 9,490 9,468 9,481 9,467 9,454 9,421 9,391 9,412 9,380 Non-financial corporations (S. 11) 21,646 20,876 19,470 21,725 21,656 21,537 21,369 21,444 21,434 20,876 20,976 20,896 20,933 20,922 Non-monetary financial institutions (S. 123, 124, 125) 2,497 2,229 2,135 2,325 2,323 2,292 2,298 2,286 2,277 2,229 2,210 2,234 2,323 2,320 Monetary financial institutions (S. 121, 122) 5,811 5,445 5,194 5,259 5,224 5,422 5,375 5,491 5,224 5,445 5,111 4,846 5,644 5,527 Claims on domestic sectors, TOTAL In domestic currency 35,994 35,692 34,558 35,836 35,720 35,854 35,763 35,970 35,784 35,692 35,407 35,334 36,103 35,955 In foreign currency 1,843 1,536 1,309 1,724 1,794 1,705 1,628 1,586 1,557 1,536 1,529 1,505 1,492 1,472 Securities, total 5,345 5,659 5,862 4,990 5,007 5,046 5,008 5,075 5,052 5,659 5,837 5,697 6,105 6,066 SELECTED OBLIGATIONS OF OTHER MFI ON DOMESTIC SECTORS, end of the month, in EUR m Deposits in domestic currency, total 26,767 28,420 29,582 27,384 27,392 27,423 27,337 27,631 27,376 28,420 28,359 27,926 30,197 30,165 Overnight 8,155 8,245 8,678 8,259 8,303 8,241 8,236 8,058 8,436 8,245 8,399 8,195 8,177 8,404 With agreed maturity -short-term 8,193 7,868 7,056 8,615 8,471 8,468 8,369 8,372 7,791 7,868 7,688 7,468 7,553 7,362 With agreed maturity -long-term 10,337 12,248 13,780 10,470 10,567 10,662 10,683 11,148 11,089 12,248 12,180 12,171 14,395 14,319 Short-term deposits redeemable at notice 82 59 68 40 51 52 49 53 60 59 92 92 72 80 Deposits in foreign currency, total 463 579 552 464 488 476 486 494 538 579 570 564 577 568 Overnight 285 386 372 304 317 305 320 329 365 386 391 384 384 385 With agreed maturity -short-term 121 133 123 107 113 108 109 109 114 133 117 120 132 124 With agreed maturity -long-term 55 59 56 52 57 62 57 55 58 59 61 59 60 58 Short-term deposits redeemable at notice 2 1 1 1 1 1 0 1 1 1 1 1 1 1 INTEREST RATES OF MONETARY FINANCIAL INSTITUTIONS, % New deposits in domestic currency Households Overnight deposits 0.21 0.22 0.20 0.21 0.23 0.23 0.24 0.24 0.26 0.24 0.24 0.24 0.23 0.22 Time deposits with maturity of up to one year 1.81 2.15 2.31 2.20 2.20 2.18 2.17 2.24 2.27 2.28 2.39 2.35 2.38 2.38 New loans to households in domestic currency Housing loans, 5-10 year fixed interest rate 5.53 5.46 5.48 5.52 5.39 5.49 5.45 5.50 5.43 5.27 5.37 5.40 5.46 5.36 New loans to non-financial corporations in domestic currency Loan over EUR 1 million, 1-5 year fixed interest rate 5.76 5.69 5.32 5.97 6.17 6.48 5.91 4.25 5.20 6.51 3.79 3.00 6.04 5.81 INTEREST RATES OF THE EUROPEAN CENTRAL BANK, % Main refinancing operation^ 1.0^ 1.2^ 0.8^ 1.2^ 1.5^ 1.5^ 1.5^ 1.5^ 1.2^ 1.0^ 1.0^ 1.0^ 1.0^ 1.00 INTERBANK INTEREST RATES EURIBOR 3-month rates 0.81 1.39 0.57 1.49 1.60 1.55 1.54 1.58 1.48 1.43 1.22 1.05 0.86 0.74 6-month rates 1.08 1.64 0.83 1.75 1.82 1.75 1.74 1.78 1.71 1.67 1.50 1.35 1.16 1.04 LIBOR CHF 3-month rates 0.19 0.12 0.07 0.18 0.18 0.06 0.01 0.04 0.05 0.05 0.06 0.08 0.10 0.11 6-month rates 0.27 0.18 0.15 0.24 0.24 0.12 0.05 0.08 0.09 0.10 0.11 0.14 0.16 0.18 Source of data: BS, BBA - British Bankers' Association. 2012 2013 5 1 6 1 7 1 8 1 9 1 10 1 11 1 12 1 |2|3|4|5|6|7|8|9|10 188 204 227 227 207 226 224 221 232 233 229 233 233 233 233 232 231 232 4,796 4,811 4,870 4,814 4,874 5,138 5,144 5,057 5,036 5,111 5,048 5,451 5,361 4,999 5,108 5,024 4,995 4,965 580 584 589 590 585 583 580 610 609 613 609 610 600 600 601 601 604 610 9,380 9,362 9,341 9,346 9,338 9,341 9,318 9,267 9,191 9,160 9,159 9,141 9,107 9,099 9,050 9,059 9,052 9,031 20,843 20,693 20,561 20,506 20,398 20,294 20,044 19,470 19,425 19,265 19,152 19,022 18,889 18,832 18,639 18,633 18,501 18,102 2,300 2,291 2,247 2,244 2,210 2,204 2,186 2,135 2,116 2,102 2,028 2,000 1,990 1,999 1,992 1,983 1,978 1,962 5,613 5,918 5,248 5,229 5,210 4,930 5,012 5,194 5,085 5,300 5,389 4,957 5,423 5,255 5,190 5,320 5,311 5,198 35,979 36,202 35,461 35,440 35,316 35,131 34,943 34,558 34,349 34,342 34,336 33,765 34,040 33,902 33,612 33,754 33,705 33,198 1,458 1,439 1,423 1,402 1,372 1,354 1,348 1,309 1,263 1,277 1,264 1,236 1,235 1,223 1,203 1,192 1,177 1,152 6,076 6,018 5,972 5,886 5,928 6,004 5,990 5,862 5,846 5,927 5,780 6,177 6,091 5,657 5,762 5,669 5,554 5,513 30,208 30,322 29,703 29,591 29,354 29,457 30,062 29,582 29,575 29,961 30,070 29,665 30,497 29,943 30,228 30,184 30,193 30,091 8,375 9,151 8,573 8,632 8,523 8,648 8,763 8,678 8,726 9,185 8,997 8,919 8,806 8,923 9,124 9,055 8,812 8,861 7,441 7,111 7,134 7,052 6,964 6,980 7,417 7,056 6,905 6,827 7,140 7,148 7,712 7,626 7,652 7,696 8,261 8,222 14,309 13,982 13,930 13,852 13,751 13,755 13,763 13,780 13,863 13,829 13,775 13,424 13,787 13,189 13,203 13,159 12,841 12,688 83 78 66 55 116 74 119 68 81 120 158 174 192 205 249 274 279 320 559 583 597 591 579 571 576 552 538 554 549 520 548 536 520 541 521 506 381 397 410 412 397 388 399 372 372 383 363 361 354 340 342 362 333 324 116 125 125 119 124 126 119 123 109 114 128 103 103 113 97 95 109 104 61 60 61 59 57 56 57 56 56 56 57 55 91 82 81 84 79 78 1 1 1 1 1 1 1 1 1 1 1 1 0 1 0 0 0 0 0.22 0.22 0.19 0.19 0.18 0.17 0.17 0.17 0.14 0.13 0.13 0.13 0.12 0.11 0.10 0.10 0.10 0.10 2.37 2.29 2.27 2.23 2.23 2.28 2.28 2.24 2.28 2.18 2.10 2.01 2.01 1.97 1.89 1.78 1.65 1.56 5.45 5.42 5.37 5.41 5.62 5.53 6.00 5.31 5.46 6.40 5.03 5.49 5.39 5.30 5.34 5.31 5.11 5.49 6.27 5.83 3.94 5.06 6.52 6.51 5.48 5.57 3.75 3.76 3.70 3.48 5.68 3.03 2.66 3.37 3.73 1.0^ 1.0^ 0.7^ 0.7^ 0.7^ 0.7^ 0.7^ 0.7^ 0.7^ 0.7^ 0.7^ 0.7^ 0.5^ 0.5^ 0.5^ 0.5^ 0.5^ 0.50 0.68 0.66 0.50 0.33 0.25 0.21 0.19 0.19 0.20 0.22 0.21 0.21 0.20 0.21 0.22 0.23 0.23 0.22 0.97 0.93 0.78 0.60 0.48 0.41 0.36 0.32 0.34 0.36 0.33 0.32 0.30 0.32 0.34 0.34 0.34 0.33 0.11 0.09 0.07 0.05 0.05 0.02 0.03 0.01 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.19 0.18 0.18 0.16 0.16 0.11 0.12 0.07 0.08 0.08 0.09 0.08 0.08 0.08 0.08 0.08 PUBLIC FINANCE 2010 2011 2012 2011 2012 2013 2012 Q^ Q4 Q1 1 Q2 1 Q3 1 Q4 Q1 1 Q2 1 Q3 2 1 3 CONSOLIDATED BALANCE OF PUBLIC FINANCING (GFS-IMF methodology), current prices, EUR m GENERAL GOVERNMENT REVENUES TOTAL REVENUES 14,794.0 14,982.3 14,999.1 3,538.4 4,016.5 3,618.4 3,712.2 3,577.2 4,091.3 3,420.1 3,495.5 3,732.5 1,094.3 1,342.3 Current revenues 13,771.5 14,037.9 14,030.6 3,319.1 3,715.6 3,410.8 3,485.9 3,367.4 3,766.5 3,184.8 3,293.6 3,510.5 1,056.4 1,202.5 Tax revenues 12,848.4 13,209.2 13,118.3 3,129.7 3,472.7 3,172.7 3,314.0 3,170.4 3,461.2 2,946.8 3,107.4 3,188.1 952.1 1,114.0 Taxes on income and profit 2,490.7 2,723.5 2,656.6 562.9 697.5 629.5 723.0 511.1 793.0 577.1 510.9 442.5 219.2 195.6 Social security contributions 5,234.5 5,267.6 5,244.1 1,303.8 1,346.2 1,342.5 1,332.8 1,306.4 1,262.4 1,264.9 1,283.4 1,261.3 438.0 461.0 Taxes on payroll and workforce 28.1 29.2 25.6 6.7 8.2 7.2 6.4 5.8 6.1 5.5 6.1 5.5 2.0 3.2 Taxes on property 219.7 215.2 233.9 84.2 53.1 26.6 64.8 79.4 63.1 24.2 67.8 91.3 9.7 8.7 Domestic taxes on goods and services 4,780.7 4,856.2 4,876.1 1,148.4 1,324.9 1,164.0 1,164.5 1,244.1 1,303.4 1,039.2 1,224.7 1,357.0 282.4 438.0 Taxes on international trade & transactions 90.7 100.2 82.5 23.8 25.1 22.3 21.9 17.9 20.5 19.4 22.9 18.2 7.3 8.3 Other taxes 4.0 17.2 -0.6 -0.2 17.6 -19.4 0.5 5.8 12.6 16.5 -8.4 12.4 -6.6 -0.7 Non-tax revenues 923.0 828.7 912.3 189.5 242.9 238.1 171.9 197.0 305.3 238.0 186.2 322.3 104.3 88.5 Capital revenues 175.7 65.3 62.5 14.4 21.7 10.5 10.8 11.7 29.5 10.7 13.1 12.8 4.2 4.1 Grants 12.6 10.4 9.2 1.0 4.0 1.3 1.8 1.6 4.5 12.9 2.7 14.7 0.3 0.8 Transferred revenues 109.5 53.8 51.7 50.5 0.6 0.1 0.5 50.0 1.1 0.5 0.4 50.9 0.0 0.0 Receipts from the EU budget 724.7 814.9 845.1 153.3 274.6 195.6 213.2 146.6 289.7 211.2 185.6 143.7 33.5 134.9 GENERAL GOVERNMENT EXPENDITURES TOTAL EXPENDITURES 16,692.7 16,546.3 16,125.7 3,955.7 4,240.0 4,326.5 3,857.4 3,836.0 4,105.7 4,137.0 4,011.3 3,845.7 1,446.9 1,388.7 Current expenditures 6,960.4 6,926.7 6,813.5 1,645.5 1,640.3 1,995.1 1,668.7 1,553.2 1,596.6 1,842.5 1,818.8 1,496.1 648.3 667.4 Wages, salaries and other personnel expenditures 3,912.4 3,882.7 3,727.7 955.0 950.4 958.3 973.9 910.8 884.7 903.4 931.6 865.9 316.5 310.7 Expenditures on goods and services 2,512.4 2,443.4 2,373.0 603.4 638.9 589.7 599.1 551.1 633.1 563.8 570.7 531.5 191.7 191.4 Interest payments 488.2 526.7 647.9 78.0 29.3 431.8 81.5 79.4 55.3 319.1 295.2 77.8 134.8 160.6 Reserves 47.4 73.9 64.9 9.1 21.6 15.3 14.3 11.8 23.4 56.2 21.3 20.8 5.3 4.7 Current transfers 7,628.5 7,818.9 7,687.0 1,855.7 1,944.4 1,957.3 1,878.7 1,903.2 1,947.8 1,948.5 1,893.7 1,922.5 632.8 617.1 Subsidies 581.9 496.3 502.7 69.1 128.2 177.1 107.8 57.3 160.5 190.5 111.9 77.6 40.5 19.6 Current transfers to individuals and households 6,277.7 6,533.5 6,384.2 1,583.0 1,598.3 1,609.2 1,588.7 1,636.6 1,549.7 1,576.7 1,585.9 1,626.1 534.5 539.3 Current transfers to non-profit institutions, other current domestic transfers 728.8 737.2 741.0 189.0 203.2 158.0 169.6 196.7 216.8 158.1 185.2 185.6 53.4 55.6 Current transfers abroad 40.1 52.0 59.0 14.5 14.6 13.0 12.5 12.6 20.8 23.3 10.7 33.2 4.3 2.6 Capital expenditures 1,310.6 1,023.5 915.0 266.5 391.6 165.3 179.2 223.4 347.2 141.6 146.3 259.7 55.0 53.6 Capital transfers 396.4 372.1 319.9 97.0 159.4 47.0 44.3 74.3 154.3 42.5 52.0 69.3 18.6 16.1 Payments to the EU budget 396.8 405.1 390.3 91.0 104.4 161.8 86.5 82.0 59.9 161.8 100.5 98.0 92.2 34.6 SURPLUS / DEFICIT -1,898.7 -1,564.1 -1,126.6 - - - - - - - - - - - Source of data: Bulletin of Government Finance. Note: In line with the changed methodology of the International Monetary Fund of 2001, social security contributions paid by the general government are not consolidated. * Data on revenues for November 2012 include corrections in DURS records for the period January-October 2012, which were due to the rectification of technical errors in the new DURS information system. 2012 2013 4 1 5 1 6 1 7 1 8 1 9 1 10 1 11M 12 1 |2|3|4|5|6|7|8|9 1,283.2 1,159.7 1,269.3 1,188.8 1,234.9 1,153.5 1,300.4 1,304.0 1,486.9 1,183.1 1,143.6 1,093.3 1,187.0 1,134.3 1,174.2 1,289.8 1,204.7 1,237.9 1,230.7 1,101.4 1,153.8 1,120.0 1,189.9 1,057.5 1,256.4 1,228.5 1,281.6 1,130.5 1,072.6 981.6 1,107.7 1,061.4 1,124.4 1,225.3 1,159.4 1,125.7 1,174.5 1,049.3 1,090.3 1,059.0 1,107.5 1,003.9 1,188.8 1,161.5 1,111.0 1,076.5 955.1 915.2 1,046.5 997.0 1,063.9 1,061.0 1,063.1 1,064.0 248.3 194.8 279.9 91.6 210.5 209.0 215.7 311.1 266.3 199.9 194.1 183.1 70.9 163.5 276.6 62.6 188.7 191.2 441.3 449.0 442.5 432.2 446.0 428.2 430.0 360.0 472.3 424.7 418.9 421.4 432.4 426.3 424.7 423.0 419.4 418.9 2.2 2.2 2.0 2.2 1.7 1.9 2.0 1.6 2.5 1.9 1.8 1.8 2.1 2.0 2.0 2.2 1.6 1.6 10.5 27.4 26.9 26.3 26.4 26.6 20.0 30.5 12.7 6.1 9.0 9.0 17.3 30.4 20.1 32.1 29.3 29.8 460.7 371.2 332.7 496.8 414.2 333.2 512.5 444.9 346.1 438.3 319.3 281.6 521.1 375.5 328.1 527.3 408.0 421.6 8.8 6.6 6.5 5.9 5.6 6.3 7.6 7.5 5.4 5.3 6.3 7.9 8.3 7.6 7.0 6.6 6.3 5.3 2.7 -1.9 -0.3 4.2 3.0 -1.4 1.0 5.9 5.7 0.3 5.7 10.5 -5.7 -8.2 5.5 7.2 9.7 -4.5 56.2 52.1 63.6 60.9 82.4 53.6 67.6 67.0 170.7 54.1 117.5 66.4 61.2 64.4 60.6 164.3 96.3 61.7 2.4 3.5 4.8 4.7 2.9 4.1 3.6 5.3 20.6 4.0 3.5 3.1 4.1 4.6 4.4 5.8 2.6 4.3 0.6 0.9 0.4 0.4 0.7 0.4 0.3 1.1 3.1 0.2 12.4 0.3 0.9 0.3 1.4 10.4 0.2 4.0 0.1 0.0 0.4 0.0 0.1 49.8 0.5 0.2 0.3 0.4 0.0 0.1 0.0 0.0 0.3 0.3 0.4 50.2 49.4 53.9 109.9 63.7 41.3 41.6 39.7 68.9 181.1 47.9 55.1 108.2 74.1 67.9 43.6 48.0 42.0 53.7 1,366.7 1,249.3 1,241.5 1,346.7 1,241.2 1,248.1 1,332.7 1,352.4 1,420.6 1,460.9 1,348.4 1,327.7 1,452.0 1,260.1 1,299.2 1,372.6 1,179.7 1,293.3 628.1 515.4 525.2 530.0 507.0 516.2 563.7 530.6 502.2 664.4 568.4 609.8 727.1 519.2 572.5 503.4 460.7 531.9 329.8 315.6 328.5 323.3 305.0 282.5 294.3 314.8 275.6 325.4 267.3 310.7 292.8 279.0 359.7 293.0 288.8 284.0 216.0 192.1 191.0 199.0 195.1 157.0 215.4 209.5 208.3 198.8 156.8 208.1 199.1 195.6 176.0 200.0 162.6 169.0 77.3 2.6 1.6 5.1 2.2 72.1 48.5 2.3 4.5 133.3 101.8 83.9 227.9 38.8 28.5 3.9 1.7 72.2 5.0 5.2 4.1 2.5 4.7 4.6 5.5 4.1 13.8 6.8 42.4 7.0 7.3 5.7 8.3 6.5 7.6 6.8 638.5 627.2 613.0 697.0 607.4 598.8 611.3 662.3 674.2 683.1 639.8 625.7 637.4 633.4 622.9 731.8 582.4 608.3 47.2 31.8 28.8 14.7 20.6 22.0 27.4 68.1 65.0 94.2 60.0 36.3 33.2 44.7 34.1 28.4 21.2 28.0 530.2 531.1 527.4 611.7 519.8 505.1 524.2 511.8 513.6 526.3 521.5 529.0 534.5 525.4 526.0 610.4 503.5 512.1 56.3 59.0 54.2 67.3 62.3 67.0 56.7 70.0 90.1 57.9 41.6 58.5 67.2 57.7 60.3 67.1 53.7 64.8 4.6 5.2 2.7 3.3 4.6 4.7 3.0 12.3 5.5 4.6 16.8 1.9 2.6 5.6 2.5 25.8 4.0 3.4 50.9 63.9 64.3 76.7 72.4 74.2 86.5 95.7 165.0 49.5 50.8 41.4 38.1 50.6 57.5 80.9 83.2 95.5 14.3 10.2 19.8 23.5 24.5 26.3 43.3 41.6 69.4 12.6 11.9 17.9 16.1 23.3 12.7 23.0 21.3 25.1 34.9 32.5 19.1 19.5 29.9 32.6 27.9 22.2 9.8 51.3 77.5 33.0 33.2 33.7 33.6 33.5 32.0 32.5 - - - - - - - - - Acronyms Acronyms in the text AJPES - Agency of the Republic of Slovenia for Public Legal Records and Related Services, BoE - Bank of England, BoJ - Bank of Japan, BS - Bank of Slovenia, CHF - Swiss Franc, EC - European Commission, ECB - European Central Bank, EIA - Energy Information Administration, EMU - European Monetary Union, ES - European Council, ESI - Economic Sentiment Indicator, ESS - Employment Service of Slovenia, ESSPROS - European System of Integrated Social Protection Statistics, Euribor - Euro Interbank Offered Rate, EUROSTAT - Statistical Office of the European Union, FED - Federal Reserve System, GBP - British pound, GDP - Gross domestic product, HICP-Harmonised Index of Consumer Prices, HUF - Hungarian Forint, ifo - Institut für Wirtschaftsforschung, IMAD - Institute of Macroeconomic Analysis and Development, IMD - International Institute for Management Development, IMF - International Monetary Fund, JPY - Japanese yen, KIS - Agricultural institute of Slovenia, LFS- Labour Force Survey, Libor - London Interbank Offered Rate, MF - Ministry of Finance, NEER - Nominal Effective Exchange Rate, NFI - Non-monetary Financial Institutions, OECD - Organization for Economic Co-operation and Development, OI -core inflation, OP RČV - Operational Programme for Human Resource Development, OP ROPI - Operational Programme of Environmental and Transport Infrastructure Development, OP RR - Operational Programme for Strengthening Regional Development Potentials, PDII - Pension and Disability Insurance Institute, PMI - Purchasing Managers Index, PRS - the Slovenian Business Register, REER - Real Effective Exchange Rate, RS - Republic of Slovenia, RULC - Relative Unit Labor Cost, SCA - Standard Classification of Activities, SRE - Statistical Register of Employment, SURS - Statistical Office of the Republic of Slovenia, ULC - Unit Labour Costs, USD - US Dollar, Zew - Centre for European Economic Research, ZUJF - Fiscal Balance Act, ZZZS - The Health Insurance Institute of Slovenia. Acronyms of Standard Classification of Activities (SCA) A - Agriculture, forestry and fishing, B - Mining and quarrying, C - Manufacturing, 10 - Manufacture of food products, 11 - Manufacture of beverages, 12 - Manufacture of tobacco products, 13 - Manufacture of textiles, 14 - Manufacture of wearing apparel, 15 - Manufacture of leather and related products, 16 - Manufacture of wood and of products of wood and cork, except furniture, manufacture of articles of straw and plaiting materials, 17 - Manufacture of paper and paper products, 18 - Printing and reproduction of recorded media, 19- Manufacture of coke and refinedpetroleum products, 20 -Manufacture of chemicals and chemical products, 21 - Manufacture of basic pharmaceutical products and pharmaceutical preparations, 22 - Manufacture of rubber and plastic products, 23 - Manufacture of other non-metallic mineral products, 24 - Manufacture of basic metals, 25 - Manufacture of fabricated metal products, except machinery and equipment, 26 - Manufacture of computer, electronic and optical products, 27 - Manufacture of electrical equipment, 28 - Manufacture of machinery and equipment n.e.c., 29 - Manufactureof motorvehicles,trailersand semi-trailers, 30 - Manufactureof othertransportequipment, 31 - Manufacture of furniture, 32 - Other manufacturing, 33 - Repair and installation of machinery and equipment, D-Electricity,gas,steamandairconditioningsupply,E-Watersupplysewerage,wastemanagementandremediationactivities, F - Construction, G - Wholesale and retail trade, repair of motor vehicles and motorcycles, H - Transportation and storage, I - Accommodation and food service activities, J - Information and communication, K - Financial and insurance activities, L -Real estate activities, M - Professional, scientific and technical activities, N - Administrative and support service activities, O -Public administration and defence, compulsory social security, P - Education, Q - Human health and social work activities, R - Arts, entertainment and recreation, S - Other service activities, T - Activities of households as employers, undifferentiated goods- and services- producing activities of households for own use, U - Activities of extraterritorial organizations and bodies. Acronyms of Countries AT-Austria, BA-Bosnia and Herzegovina, BE-Belgium, BG-Bulgaria, BY-Belarus, CH-Switzerland, HR-Croatia, CZ-Czech Republic, CY-Cyprus, DE-Germany, DK-Denmark, ES-Spain, EE-Estonia, GR-Greece, FR-France, FI-Finland, HU-Hungary, IE-Ireland, IL-Israel, IT-Italy, JP-Japan, LU-Luxembourg, LT-Lithuania, LV-Latvia, MT-Malta, NL-Netherlands, NO-Norway, PL-Poland, PT-Portugal, RO-Romania, RS-Republic of Serbia, RU-Russia, SE-Sweden, SI-Slovenia, SK-Slovakia, TR-Turkey, UA-Ukraine, UK-United Kingdom, US-United States of America. Slovenian economic mirror November 2013, No. 11, Vol. XIX