Slovenia flag

Slovenia country brief

Located in Central-Southern Europe, Slovenia has 1,086 km of land borders withHungary to the north, Croatia to the east and Italy and Austria to the west. Slovenia has 47 km of coastline, and is home to over 2 million people (June 2012 est.). The capital of Slovenia is Ljubljana.

Slovenia is a democratic republic, with a bicameral parliamentary system. It declared independence from the former Yugoslavia in 1991. In 2004 Slovenia became a member of the EU and NATO. Slovenia joined the Eurozone on 1 January 2007, and joined the EU Schengen zone on 21 December 2007. It was the first former communist member of the EU to hold the rotating Presidency of the European Union (January to June 2008).

Bilateral relations

Relations between Australia and Slovenia are based on strong community ties and small, but growing, trade relations. Australia recognised Slovenia as an independent state on 16 January 1992 and established diplomatic relations on 5 February 1992. 2012 marks the 20th anniversary of diplomatic relations between Australia and Slovenia.

The Australian Embassy in Vienna is accredited to Slovenia and an Australian Honorary Consul is based in Ljubljana. Austrade covers Slovenia from Warsaw. Slovenia has an Embassy in Canberra, and a Consulate-General in Sydney. The first Slovenian Ambassador to Australia was appointed in June 2011.

Community and educational links

Australia has a small but active Slovenian migrant community, many of whom migrated to Australia in the 1950s and 1960s from the then Yugoslavia. The 2006 Census recorded 6,222 Slovenian-born living in Australia, with 16,085 claiming Slovenian ancestry. Although amongst the Slovenian community there is a general view that altogether there are around 25,000 people of Slovenian descent living in Australia. The majority lives in Melbourne and Sydney, followed by communities in Adelaide, Perth, Brisbane and Canberra.

In 2010, Bostjan Žekš, thenMinister responsible for Slovenians Abroad, visited Australia and met with Australian Government representatives and Australians with Slovenian heritage.

Australia has gained a distinct cultural profile in Slovenia through the artistic directorship of Festival Maribor by the Director of the Australian Chamber Orchestra (ACO), Richard Tognetti. First held in 2008, this annual two-week cultural event in Slovenia's second largest city has showcased Australian excellence by featuring artists such as William Barton, the Tawadros brothers, and photographer Jon Frank. In September 2012, the ACO becomes Festival Maribor's Orchestra in Residence, when Maribor will feature as one of two European Capitals of Culture.

Trade and investment

Slovenia is Australia's 81st largestmerchandise trading partner. Australia is Slovenia's 48th largest export destination and 67th largest import destination. Two-way merchandise trade in 2011 totalled A$80 million, with Australian exports accounting for A$25 million and Slovenian imports to Australia accounting for A$55 million. Australia's major exports to Slovenia included coal, starches, insulin and wheat gluten and medicaments (including veterinary). Slovenia's main exports to Australia in 2011 included medicaments (including veterinary), household-type equipment, non-electrical machinery and parts and electronic integrated circuits. Australia's investment in Slovenia for 2011 totalled A$10 million; there is no recorded Slovenian investment in Australia.

Harvey Norman opened its first furniture retail store in Ljubljana in 2002. It has since expanded and now has 5 stores.

Impact International,a leading laminate and plastic tube-maker, was founded in 1959 by Slovenian immigrant Dusan Lajovic. It has a plant producing aluminum tubes, aerosol cans, plastic and laminate tubes in Slovenia.

Bilateral Agreements

The Commonwealth ratification of a Reciprocal Health Care Agreement between Australia and Slovenia came into force on 1 July 2011. This Agreement gives Slovenian visitors in Australia access to the public health system for 'medically necessary treatment' during their stay; and Australian Slovenians who are temporarily staying in Slovenia are entitled to health services in Slovenia if they have permanent residence in Australia.Under the Agreement on Social Security between Australia and Slovenia, Australia and Slovenia share the responsibility for paying pensions to people who would not otherwise be entitled because they would not satisfy residency requirements.

Recent visits

Political Overview

The President of the Republic is the Head of State and is elected by popular vote every five years, for a maximum of two terms. Dr Danilo Türk was elected President in November 2007. Dr Türk was Slovenia's first Ambassador to the United Nations in New York and from 2002 to 2005; he held the position of Assistant Secretary General for Political Affairs at the United Nations Headquarters in New York. The President is the Supreme Commander of the Armed Forces who, despite having chiefly ceremonial powers, retains enough authority for the system to be characterised as a 'dual executive'. The powers of the President include nominating the Prime Minister after consultation with parliamentary groups and, in rare circumstances, the power to pass laws and dissolve the parliament.

Legislative power is vested in the Head of Government, the Prime Minister, and a Council of Ministers (Cabinet). Both the Prime Minister and the Council of Ministers are elected by parliament.

The bicameral Slovenian parliament is made up of the 90-member National Assembly, and the 40-member National Council. The National Assembly is elected for four years and comprises 38 directly elected deputies, 50 members selected on a proportional basis and two non-elected representatives of the Hungarian and Italian minorities. The National Council, which exercises an advisory function, has 22 directly elected members and 18 non-elected members representing various social, economic, trading, political and local interests.

Following Slovenia's snap election on 4 December 2011, Prime Minister Janez Janša from the Slovenian Democratic Party (SDS) was sworn in by Parliament on 28 February 2012. Janša's five party centre-right coalition government, led by SDS, comprises the Civic List of Gregor Virant (CLGV), the Democratic Party of Pensioners of Slovenia (DeSUS), the Slovenian People's Party (SLS), and New Slovenia (NSi). The government's main focus during its four year term will be to enforce budget cuts, stimulate the economy, cut red tape, reduce taxes on labour and profits and speed up privatisation.

The government's other priorities include combating climate change and promoting the expansion of renewable energy sources. The Organisation for Economic Co-operation and Development's (OECD) 2011 Economic Survey of Slovenia emphasised the urgent need for pension reform, reform of the education system and policies to promote innovation, labour market flexibility and making Slovenia more conducive to foreign direct investment.

Foreign policy

Slovenia is a small, but active, member of the international community. Slovenia has been a member of the United Nations (UN) since May 1992. From 1998 to 2000, Slovenia occupied a non-permanent seat on the UN Security Council. Slovenia is seeking candidacy for the UN Human Rights Council for 2016 -2018 - Slovenia was a member of the council between 2007 and 2010. Slovenia served as the Chair of the International Atomic Energy Agency's Board of Governors in 2006-07; and held the chair of the Organization for Security and Co-operation in Europe (OSCE) in 2005.

Slovenia became a member of the European Union on 1 May 2004 and held the rotating Presidency of the Union from January to June in 2008. Slovenia's European Union commissioner, Janez Potočnik, is currently serving his second term (2010-14) as European Commissioner for Environment. Slovenia is also a member of the Council of Europe, which it joined in May 1993 and chaired for the latter half of 2009.

One of the goals of Slovenia's foreign policy is to ensure stable relations with its neighbours – Austria, Italy, Hungary and Croatia - and pays special attention to the position of the Hungarian and Italian minorities in Slovenia and to the Slovenian minorities living in neighbouring countries. Slovenia works alongside other Central European countries within the Central European Initiative and Regional Partnership and contributes to the stabilisation of South Eastern Europe within the Stability Pact.In 2011, Slovenia's capital Ljubljana became the seat of the European Agency for the Co-operation of Energy Regulators

Slovenia joined NATO in March 2004. Slovenia currently has several hundred troops deployed on foreign peace-keeping missions, a reflection of its commitment to international conflict resolution.Slovenia contributed contributed 17 military experts on mission and troops to UN Military Peace Operations in 2011 and as of May 2012, contributes 32 contingent troops, expert on missions and military experts to three UN peacekeeping missions to UNIFIL (Lebanon), UNSMIS (Syria), and UNTSO (Middle East).

Slovenia restructured its armed forces in 2006, primarily to participate in NATO operations outside of Slovenia. Slovenia takes an active role in the Balkans by participating in the EU Mission Althea in Bosnia and Herzegovina, and the NATO Force in Kosovo (KFOR). Slovenia has also deployed troops to Afghanistan, as part of the United Nation's International Security Assistance Force (ISAF) but plans to withdraw its Operational Mentor and Liaison Team (OMLT) by the end of 2012. Slovenia has also deployed troops to other multilateral operations and contributes to the NATO Equipment Donation Program.

Established by the Slovenian Government in 1998, the International Trust Fund for Demining and Mine Victims Assistance (ITF) is a humanitarian non-profit organization that identifies and coordinates tenders for demining, mine-risk education and mine victims assistance projects, as well as small arms and light weapons and conventional weapons stockpile destruction projects.Its initialand key purpose is to assist Bosnia and Herzegovina in the implementation of peace agreement, the Dayton Agreement (December 1995), by raising funds, providing services and managing mine action projects. The ITF is now broadening its focus to fundraising activities and support to humanitarian mine action in mine-affected regions and countries such as Southern Eastern Europe, Cyprus, the South Caucasus, Latin America and more recently, ITF has expanded its engagement in the Middle East and Central Asia. The ITF also continues to coordinate the South Eastern Europe Mine Action Coordination Council.

Economic Overview

Slovenia's economic performance has traditionally been stronger than the other former Republic of Yugoslavia states. Slovenia was one of the strongest economies of the countries that joined the European Union in 2004. Slovenia was also the first of the new EU members to join the Eurozone, which it did on 1 January 2007. Slovenia's economy is highly dependent on foreign trade, particularly on its principal export destinations (Germany, Italy and Austria) - with two-thirds of its trade being conducted with countries of the European Union.

Inflation reached 2.1 per cent in 2011. Slovenia's realgross domestic product(GDP)contracted by0.2 per cent in 2011. GDP is expected to drop by 1.5 per cent in 2012; but is expected to rebound 0.5 per cent in 2013, and 1.5 per cent in 2014. Slovenia's budget deficit in 2011 was 6.4per cent, and public debt rose to 47.6 per cent of GDP from 38 per cent a year earlier.

According to recent forecasts, GDP per head of population will be about 25 per cent higher in 2015 than in 2010. In 2011, Services account for 90.5 per cent of Slovenia's GDP; industry 6.9 per cent; and agriculture 2.5 per cent. Public ownership and control of enterprises is still widespread in Slovenia. A considerable percentage of directly owned state enterprises can still be found in energy, ports, telecommunications, post and rail industries, as well as banking and insurance.

In the first quarter of 2012 Slovenia's unemployment rate stood at 8.8 per cent per cent, up from an average of 8.2 per cent in 2011. Slovenia's employment protection is high compared to other European countries and its labour movement is not very active. While the government continues to gradually implement reforms to make Slovenia more business friendly, privatisation and increased investment opportunities remain key economic policy issues for Slovenia. Slovenia also faces an urgent need to reform its welfare system, particularly its pension and health system, in response to the rapid ageing of its population. Further priorities include reducing state involvement in the economy, easing of employment protection legislation, as well as reducing disincentives to work for older citizens. However, reform in these areas is slow and difficult due to the consensus-based nature of Slovenian policy-making, where the broadest possible social consensus is sought before important reforms are introduced.

Trade Profile

Membership of the Central European Free Trade Area (CEFTA) and the EU make Slovenia attractive as a gateway to markets in Central Eastern Europe and the Western Balkans.

The port at Koper, modern rail and road transport networks that connect with central Europe, and traditional business ties with the other former Yugoslav republics give Slovenia a strong platform for businesses wishing to operate in the central and eastern European markets. By using the southern sea-route access to Central Europe, ships coming into the Mediterranean through the Suez Canal can save between 5 to 10 days, or up to 3,700 km, as compared to other major North European ports.

While productivity levels have climbed to close to the Euro area average since Slovenia's transition to a market economy in the 1990s, productivity remains low in a number of sectors. Privatisation of state assets is one area where Slovenia has lagged behind other Central European countries. However, Slovenia's new centre-right government said it wants to proceed with the sale of stakes in banking, energy and telecommunications assets, which came to a halt in recent years. A considerable share of the economy remains in state hands. Over the last 20 years, Slovenia's stock of foreign direct investment (FDI) has grown more slowly than that of other Central European Economies and will need to be strengthened further to stimulate economic dynamism and raise productivity.

An extensive infrastructure program will create opportunities for civil engineering firms.

Trade Opportunities

Business opportunities exist for Australian businesses in infrastructure development projects and sectors such as IT, pharmaceuticals, banking, insurance and telecommunications. There will also be investment opportunities as the Slovenian government moves to sell some of its states assets as part of the austerity package, such as ports (Port Koper), highways, national airlines, airports (Ljubljana airport), telecoms, insurance areas and possibly in the retail sector.

Further investment opportunities exist in Slovenia in pharmaceutical and white goods firms, manufacturing industries, strategic services, shared services centres, logistics and distribution centres, as well as R&D and the energy sector, particularly renewable energy.

Updated July 2012