LJUBLJANA, SLOVENIA

Before 1991, Slovenia was the most prosperous of the former Yugoslav republics and, arguably, of all Eastern European countries. Since independence, it has stayed away from political and economic disturbances that have plagued the region and has been cautious in its reform policies, displaying continuity as well as an affinity to consensus. Although unemployment is still an issue, the new government has pledged to cut it by 20 percent, while increasing social assistance by 60 percent and pursuing an active social housing policy. Pension funds have generally run a balanced budget, as any shortfalls in revenue (mostly derived from payroll contributions) have been covered by government transfers. Privatization, although slow, has been more transparent than elsewhere in the Balkans and has not led to serious charges of corruption and illicit fortunes. The rule of law has kept crime on lower levels, thus contributing to social stability and justice. Slovenia has avoided poverty of the proportions of other economies in Eastern Europe.

The structure of consumption in Slovenia is closer to central European models than to its Balkan neighbors, and private consumption per capita is more than twice the level in Bulgaria. Due to its socialist legacy, in 1995, Slovenia was still considerably more egalitarian than Greece or the United States. The poorest 20 percent controlled 8.4 percent of the nation's consumption (compared to 7.5 percent in Greece and 5.2 percent in the U.S.) while the wealthiest 20 percent consumed 35.4 percent (40.3 percent in Greece and 46.4 percent in the U.S.). Slovenia's Gini index in 1995 was 26.8, while Greece's was 32.7, and the United States' was 40.8. Economic growth over the next decade and the accession to the European Union will further increase living standards for the Slovenes.

According to the United Nations Development Programme, Slovenia is a leader among Eastern European countries measured by its human development index, almost equaling those of the poorer members of the EU.


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