Vasle said at a meeting of business representative from the Istra region that Slovenia's potential growth had halved, while its debt doubled.

Slovenia is also lagging behind in practically every competition rankings, while the situation on the European financial markets is deteriorating. For now, the country is not paying high interest rates, but there are warnings that this could change, Vasle warned.

Investments and exports are of key importance for Slovenia's economy, said Vasle, adding that these two fields were in "some sort of a vacuum". Compared to countries like Poland and the Czech Republic, Slovenia is "at the bottom".

Vasle noted that most countries already exceeded export levels from 2008, while Slovenia's was still lagging behind some 15%.

He also warned that Slovenia had not yet reached bottom in some fields, including construction, and that layoffs would continue in the second half of the year, probably increasing unemployment rates.

IMAD projections show that Slovenia's export will increase 6.9% in 2011 and import will increase by 5.1%. GDP is to go up by 2.2% this year and 2.6% in 2012.

Pointing to low productivity, Vasle said that labour costs had grown beyond the EU average in the past years. This trend is continuing, said Vasle. "Every quarter, we lose a part of our competitive position."

Vasle was also critical of the government's continuous promises that deficit would decrease in the coming year, however every year the deficit gets higher, and the trend has persisted for a decade, he said.

To help recovery, Slovenia's finances should be consolidated and the high budget deficit reined in, Vasle said. The country also needs to deal with its ageing population.

He also underlined the importance of increasing the productivity of Slovenia's economy. Vasle stressed that high economic growth in the past years had misled Slovenia about how productive its economy actually was.