The recommendations, issued as part of a review of the stability programme and national reform programme for 2014 and 2015 in the framework of the European semester, are largely expected and mostly involve fiscal and economic policy measures.

The Commission thus proposes that Slovenia "reinforce the budgetary strategy with sufficiently specified structural measures" in order to ensure elimination of the excessive deficit by 2015.

This includes adopting the golden fiscal rule and introducing functioning budgetary monitoring, and a "comprehensive review of expenditure covering state and local government levels."

Slovenia has also been urged to complete the privatisation of NKBM bank in 2014 as planned, prepare Abanka for privatization in 2015, and continue the implementation of restructuring plans of the banks which received state aid.

It should also finalise a comprehensive action plan for banks by August 2014 and "clarify the mandate of the Bank Asset Management Company" by publishing a management strategy by September.

The report says Slovenia made "substantial progress in addressing the recommendations regarding stability in the banking sector," but "the work is far from completed".

The Commission in general urges Slovenia to pursue privatisation, including by finally drawing up a classification of assets that the newly established Slovenia Sovereign Holding will have at its disposal.

A recurring recommendation is the call for completion of a corporate restructuring plan, which should be accompanied by a review and, if necessary, changes of insolvency legislation.

The Commission notes that the government has made only "limited progress" in
implementing the recommendations on corporate governance of state-owned enterprises.

"The level of state influence creates significant risks for the public finances both directly and indirectly...A coherent strategy for the management of state-owned enterprises coupled with improved corporate governance would create a more favourable environment for attracting foreign direct investment," the report reads.

These four recommendations are considered key - and they were expected based on previous assessments of Slovenia's reform efforts.

They are coupled with additional recommendations regarding the minimum wage, which the Commission said ought to be redefined and its indexation reviewed, and sustainability of the pension system beyond 2020 by linking the statutory retirement age to gains in life expectancy.

Furthermore, it should reduce obstacles to doing business in key areas for economic development rendering the country more attractive to foreign direct investment particularly through accelerated liberalisation of regulated professions and reduction of administrative burdens.

As a final recommendation, the Commission says Slovenia should take "effective measures to fight corruption", but it does not go into detail beyond suggesting that it should enhance transparency and accountability, and introduce external performance evaluation and quality control procedures.

European Economic and Monetary Affairs Commissioner Olli Rehn said Slovenia needed continued action to reduce the excessive deficit, ensure the sustainability of public debt and address the challenges in the bank and corporate sectors.

"I'm concerned about the economic sustainability of Slovenia for the sake of the Slovenian people...It's important that is able to effectively tackle these challenges that are outlined in the recommendations," he said.

The Commission said it will continue close monitoring of member states which have excessive macroeconomic imbalances - Slovenia, Croatia and Italy, but it will not launch formal proceedings.

According to Rehn, the national reform programmes of all three countries "appropriately addressed the main challenges". "However we will monitor very closely the implementation of today's concrete detailed recommendations."