Exports remain the main engine of growth, resting on the back of a weak recovery in Slovenia's main trade partners and improved cost competitiveness in the tradable sector that is being reflected in growing market shares, the government forecaster finds in its latest outlook, released on Tuesday.

The rates of export growth this and next year will be above the expectations owing to more favourable trading conditions and the strong decrease in oil prices, with a greater positive effect of the launch of production of new car models.

As a further factor contributing to growth, IMAD also points to a stepping-up in EU-subsidised public investment projects, which is expected to slow down next year.

Nevertheless, capital expenditure will be stronger than expected in the autumn due to major investments in machinery and equipment as a result of a boost in exports and value added in manufacturing and higher gross profits in tradable sector owing to improved trading conditions.

Projections of private and government spending are largely unchanged, with households consumption expected to recover gradually on the back of the improving conditions on the labour market and higher confidence, whereas fiscal consolidation will continue to drag down government spending.

IMAD also upgraded its outlook for the labour market, with 120,100 people out of a job expected to be registered at the end of the year, 500 fewer than expected in the autumn. The unemployment rate projection remains at 13.1%.

The unemployment total is then projected to drop to 115,700 in 2015 and to 112,000, down by 3,700 and 4,700 from the autumn projections. The jobless rate is forecast to drop to 12.6% in 2015 and further still to 12.2%.

Falling prices of oil and other raw materials also affected inflation projections. The inflation rate forecast is downgraded by 0.1 percentage point to 0.5% for the year, and by as much as one point to 0.1% for 2015. The rate is then expected to rise to 1% in 2016, up 0.3 points on the autumn projection.

Negative risks to the winter forecast are mainly related to a potential slow-down in recovery in Slovenia's main trade partners, but IMAD also says that lower oil prices and a weaker euro could also have a positive impact, although geopolitical tensions are considered to be an additional risk factor.

Considering the main fiscal policy goal for 2015 remains reducing the general government deficit to below 3% of GDP, a negative factor affecting growth would be a change in the structure of measures aimed at achieving the goal or if the measures proved insufficient.