As of Monday the Government Institute for Macroeconomic Analysis and Development – the aptly named IMAD – published new forecasts for Slovenian economic growth.
PM Borut Pahor and finance minister Franci Križanič (brushed up from source)
Growth? Think again…
IMAD predicts that Slovenian economy will shrink by 4 percent in 2009, which would apparently be the largest economic downturn in history of independent Slovenia. Apparently even independence itself and consequent loss of Yugoslav markets didn’t hit Slovenian economy as bad as this. New unemployment projections now show that as much as 100,000 people might find themselves being laid off, which would bring unemployment to about 9 percent.
Admittedly, the people at IMAD are not the quickest of cats at the best of times (its former director some three years ago famously said that there is no way for a price of a barrel of oil to go above 100 dollars) and they have maintained until recently that Slovenia will experience minimal growth, but this prediction is a much-needed reality check. It means that the government of Borut Pahor will have to dig deeper, faster and harder than anything we’ve seen to date.
Among other things this means that rebalancing of the budget which the parliament is expected to approve today is more or less worthless and that finance minister Franci Križanič and his team will have to go – in the words of Wile E. Coyote – back to the old drawing board. When asked about it last week, Križanič said that the crisis will turn in the middle of this year. The problem is that he sounded as if the crisis must turn in the middle of the year. As if they just spent their last bullet.
PM Borut Pahor adopted a hitchiker’s attitude as is saying (in nice, big, friendly letters): Don’t panic!. Some quasi-experts think otherwise and say it’s time to panic. Both pieces of advice are wonderfully useless.