Slovenia’s Q3 2020 GDP Down 2.6% YoY

According to the Statistical Office of Slovenia, GDP in Q3 of 2020 decreased by 2.6% compared to the Q3 of 2019 and in 9M of 2020 it decreased by 6.0% over the same period of 2019.

Due to opening of economies in the 3Q of 2020, domestic consumption improved compared to the lock-down period when it fell by 12.5% YoY. Domestic expenditure declined by 5.0% YoY due to both final consumption expenditure and gross capital formation. Namely, final consumption expenditure improved significantly by declining only 0.3% YoY while gross capital formation accelerated its decreased and dropped by 19.6% YoY. The high decrease in gross capital formation is a consequence of the decrease in inventories. Gross fixed capital formation decreased by 1.8%. A decline was observed in machinery and equipment, while construction investment increased (by 2.7%).

Household final consumption, as the most significant component of the final domestic expenditure, decreased by 0.9% YoY and this decrease was less prominent than in the first two quarters of 2020. (-17.4% YoY in Q2 and -6.3 in Q1). Household final expenditure on the domestic market decreased by 6.0%. The highest decrease among household expenditure was observed in consumption of fuels and services. General government expenditure in Q3 increased by 1.4% YoY as government continued with measures to dampen the fall in economic activity.

In Q3 exports decreased by 9.5% YoY, export of goods decreased by 4.6% and due to strong decline in international travelling caused by pandemic measures, export of serviced dropped by 25.8%. Among services, the largest decrease was observed in travelling. Somewhat higher decrease was evidenced with imports which were down by 13.2%. Due to higher drop in imports, the external trade balance had a positive contribution to GDP volume growth (2.0 p.p.).

The aforementioned decrease was one of the lowest in the region, beating the expectations of macro analysts. To put things into a perspective, the GDP drop in Q3 was lower than in some EU countries such as Austria (-5.3%), Belgium (-5.2%), Hungary (-4.7%), Italy (-4.7%), France (-4.3%) and Germany (-4.2%) .