Page 138 - SE Outlook Regions 2023

3.11.5 Construction

Slovenia’s GDP growth slowed to 3.4% year on year in the third quarter
of 2022, but acceleration was observed in construction (annual growth
was 10.4%; in the previous quarter 7.7%).

The International Monetary Fund (IMF) said that rapid house price
growth has increased concerns about real estate overvaluation and the
Bank of Slovenia has appropriately responded by changes in
macroprudential policies, including the introduction of a sectoral
systemic risk buffer and lower loan-to-value limits on second homes.

Slovenia's housing market is not showing signs of cooling just yet
although real estate agents say prices have stopped going up mid-year.

After a record surge in 2021, prices of residential properties rose by a
further 4.1% in first quarter 2022 on the quarter before, going up by as
much as 19.6% year on year.

Additional pressure on the prices comes from a potential change in
property taxation that would reduce the return for property owners,
according to exports. The new government has announced it will raise
tax on rental income from 15% to 25%, the rate in force prior to 2020.

3.11.6 Major Sectors

Compared to 2020, Slovenian tourism recorded better results in 2021.
The inflow from travel exports amounted to €1.5bn, which is 26% more
than in 2020. Foreign guests generated 50% more arrivals than 2020
and 43% more overnight stays.

In the first ten months of 2022, Slovenia recorded even better results as
3.6mn foreign tourists visited the country, which is up by 115% y/y while
overnight stays of foreign tourists grew 113% to nearly 9.3mn,
according to the statistics office.

Minister of Economic Development and Technology Zdravko Pocivalsek
said that the pandemic had severely affected the tourism sector, which
was then followed by the war in Ukraine. He said that the state had
helped the sector with more than €1bn in 10 anti-corona packages and
a special intervention law.

In 2022-2023, the Slovenian authorities plan to develop the segment of
active outdoor experiences and sports tourism as the most promising.

Slovenia plans to develop its space industry as the space sector began
to develop intensively after the country became an associate member
of the European Space Agency (ESA) in 2016.

Slovenia also decided to increase its contribution to European Space
Agency (ESA) programmes in 2022 and 2023 from €3mn to €5.8mn per
year, as it aspires to become a full member of the agency in 2024.

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