In the report unveiled on Thursday, the Commission says Slovenia was among the fastest-growing economies in the eurozone last year, when its GDP expanded by 5%.
Despite the significant upgrade, the forecast from Brussels is lower than the forecast issued by the government forecaster IMAD in March. IMAD expect the country's economy to grow by 5.1% this year and by 3.8% in 2019.
Meanwhile, the Commission's report projects Slovenia to create a 0.5% budget surplus this year, which compares to a balanced budget the Commission forecast for Slovenia in November. In 2019, Slovenia is to record a 0.4% surplus, which is on a par with the autumn forecast.
However, the Commission believes Slovenia's structural fiscal situation will worsen after last year's improvement. It expects the structural deficit to reach 1.1% of GDP this year and increase to 1.5% in 2019.
In November, the Commission said the structural deficit for 2016-2018 would remain unchanged at 1.6% of GDP to be reduced by 0.2 percentage points in 2019.
Public debt is projected to drop to 69.3% of GDP this year, a full four percentage points lower than in 2017; in 2019 it is projected to decline further, to 65.1% of GDP.
The Commission forecasts that the labour market will tighten, as employment is forecast to grow by 2.3% in 2018 and 1.5% in 2019.
Accordingly, the unemployment rate is projected to decrease by a full point to 5.6% in 2018 and hit 5.4% in 2019.
Inflation is projected to amount to 1.9% this year and 2% in 2019, approximately half a point higher than in the eurozone.
