The Commission wrote Slovenia's real GDP increased by 4.8% in the first half of the year, thereby surpassing the pre-crisis level.

Domestic demand increased by another 3.4%, while investment also got stronger, by 10%. Export growth remained strong as well, exceeding import growth, which contributed additionally to the current account surplus. Solid growth is also expected in the second half.

The Commission expects 4% GDP growth in 2018 and a 3.3% expansion in 2019, including due to stronger domestic demand that will in turn fuel investment. Industrial production, exports and construction sector investment are also expected to continue growing.

A moderate reduction is meanwhile projected in 2018 and 2019 in the current account surplus.

The Commission meanwhile mostly sees risks for excessive growth, arguing increased consumer optimism and easier access to credit could boost investment further, especially in housing.

The risks to lower than expected growth are meanwhile mostly external and mostly have to do with fluctuations in the prices of energy and raw materials.

Inflation for next year is projected at 1.5% and for 2019 at 1.8%, while the survey unemployment rate is to fall from this year's 6.8% to 5.2% by 2019.

The public finance deficit is expected to fall to 0.8% of GDP this year, mostly due to higher tax revenue, while a 0.4% surplus is projected for 2019.

While Slovenia expects its public finances will be balanced in nominal terms in the coming two years or even see a slight surplus, the Commission continues to argue that a structural deficit will persist.

According to the Commission, the structural deficit for 2016-2018 will remain unchanged at 1.6% of GDP to be reduced by 0.2 percentage points in 2019. The main risks to Slovenian public finances are related to public sector wages and pensions.

The government's macro-economic think tank IMAD responded to the forecast by saying it is in keeping with its own and that of other institutions.

It added that the unemployment situation would benefit additionally from the continuing reduction in the size of the working age population.

While agreeing about the important role of ever higher disposable income and consumer confidence, IMAD said the higher economic growth than last year would primarily be the result of an increase in state investment.

IMAD upgraded in September its growth forecast for Slovenia to 4.4% and 3.9% for 2017 and 2018 respectively. A month ago the IMF revised its forecast to 4% and 2.5%, and on Wednesday the EBRD to 4% and 2.9%.