May 20, 2020 / 3:32 PM / 5 days ago

Slovenia expects strong 2021 recovery after epidemic - finance minister

* Slovenia declared an end to its coronavirus epidemic

* Alpine country has reported 105 coronavirus deaths

* Strong growth expected in 2021, minister says

By Marja Novak

LJUBLJANA, May 20 (Reuters) - Slovenia’s economy is expected to return to strong growth in 2021 after it overcomes the financial impact of the coronavirus, Finance Minister Andrej Sircelj told Reuters on Wednesday.

The small Alpine country also plans to reduce the budget deficit next year — after an expected deficit of about 8% of GDP this year following a surplus of 0.5% in 2019 because of financial measures taken to ease the consequences of the epidemic.

Sircelj gave no figure for expected 2021 GDP growth but the European Union’s executive, the European Commission, has forecast Slovenia’s growth at 6.7% in 2021 versus an expected fall of 7% this year.

Sircelj said growth was possible in 2021 because Slovenia had dealt successfully with the coronavirus and has a relatively flexible economy. It has already declared an official end to its coronavirus epidemic.

“Many Slovenian companies are adaptable, we have personnel that are highly educated, have a lot of knowledge — many Slovenians speak foreign languages ... which gives us an advantage that we can use on markets,” Sircelj said.

He said the government had responded quickly to the epidemic by offering financial help worth 3 billion euros ($3.30 billion) or about 6% of 2019 GDP in April to citizens and companies hit by the coronavirus, and further measures worth 1 billion euros are due to be passed by parliament.

Slovenia has reported 1,468 coronavirus cases and 105 deaths. It started easing its lockdown on April 20.

Sircelj said public debt should not increase further next year though it was expected to rise to 82.4% of GDP this year versus 66.1% in 2019. He was unable to say how long it would take for debt to be below 60% of GDP, the EU maximum.

He said Slovenia has a “stable and robust liquidity position at present”, and the government has the right to raise another 2 billion euros of debt this year if needed.

$1 = 0.9098 euros Editing by Timothy Heritage

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