IMF Mission in Slovenia: adopt urgent reforms ASAP


Presenting the concluding report of the mission, which started its work on 20 September, Spilimbergo said the crisis had shown Slovenia's past economic model to be unsustainable.

The country thus faces many challenges, with Spilimbergo highlighting the financial sector. He said the share of state banking in Slovenia was high and that these state-owned banks were burdened by many bad loans, which is a source of concern for financial markets.

The official finds getting rid of the bad claims to be of key importance, while it also needs to be made sure that this problem does not resurface in the future.

Banks need to be restructured and then privatised, the official said. With Slovenia's public debt being low in comparison with other EU countries, privatisation is not important only to reduce debt but also to secure a better management of companies, which are excessively burdened by debt.

Also among the important challenges for Slovenia is the reform of the pension system and the labour market, Spilimbergo said.

IMF representatives, who were hosted by central bank Banka Slovenije, examined economic policy plans and the state of the economy.

Before this visit, an IMF mission was in Slovenia in April, when it conducted an assessment of the state of the financial system and of supervision and crisis management in the sector.

It established that the crisis had dealt a serious blow to the financial sector and proposed better management in state banks among other things.