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Slovenia's GDP growth to accelerate to 3.5% in 2017 - Intesa Sanpaolo

Author Maja Garaca
Slovenia's GDP growth to accelerate to 3.5% in 2017 - Intesa Sanpaolo potowizard/

LJUBLJANA (Slovenia), June 30 (SeeNews) – Slovenia's real economic growth rate will rise to 3.5% in 2017, followed by slight decelerations, to 3.0% and 2.4%, in 2018 and 2019, Italian banking group Intesa Sanpaolo said.

The acceleration relative to 2016, when the growth rate was 2.5%, mainly reflects the dynamics of government investment in line with the government’s plan for the absorption of EU funds, Intesa Sanpaolo said in its June forecast note.

"With rising demand and favourable conditions for investment throughout the forecast period, further growth in investment in machinery and equipment is projected, and, with the recovery in the real estate market, a gradual rebound in housing investment," the lender said.

Issuance of building permits and construction activity indicators point to a revival in the construction of dwellings, it judged.

Inflation is expected to strengthen to 1.8% this year, particularly owing to higher energy prices, and should remain at similar levels in the next two years.

In terms of the banking sector, loans are seen to grow at a low pace in 2017, by 2.0%, which will continue in 2018 and 2019 (2.5% and 2.7%, respectively). Deposits, however, are expected to rise by 5.8% in 2017 and around 5.0% in the following years as well.