“Stakeholders participating in the forming of the future coalition must bear in mind that early on in its term, the government faces decisions whose horizon goes beyond the political cycle. These decisions may not jeopardise fiscal consolidation,” the Fiscal Council said in a statement issued on Thursday, as presented by STA.
According to Slovenian fiscal policy watchdog, the new government that will be formed, will need to make sure it follows a sustainable fiscal policy given mounting risks to growth.
Due to the fact that the current fiscal policy is expansionary, it insists that it is “inappropriate considering the current position in the economic cycle and represents a missed opportunity to improve public finances on a more permanent basis.”
The watchdog notes that “in light of growing risks, especially external risks,” being more restrained financially and disciplined, “noting that these risks may lead to a slowdown of economic growth beyond the current forecasts.”
This is not the first time the council is warning against further uncontrolled fiscal expansion. For quite some time now, it is being stressing that Slovenia “should leverage the currently favourable macroeconomic conditions to accelerate the consolidation of public finances.”…. / IBNA