Release date 19. March 2021

Reduction in excess mortality vital for reduction in restrictiveness index

On Slovenia's Economy

• Consensus Outlook for Slovenia’s GDP fell a bit in last month what was expected due to positive surprise in lower-than-expected reduction in GDP for 2020 (-5.5 %). Consensus GDP growth stands currently at 4.4 % for 2021 and at 4.3 % for 2022. But this does not tell the whole story as changes in subcomponents of the GDP (of expenditure method) were different. Household consumption growth for 2021 was downgraded from 5.5 % to 4.6 %, gross fixed investments from 6.5 % to 6.1 % growth, whereas growth outlook for exports of goods improved. Connected to the latter, industrial production outlook improved from 5.6 % (previous month) to current 6.1 % growth (low: +3.5 %, high: +9.7 %). No major changes took place for estimate of the CPI (1.2 % in 2021 and 1.7 % in 2022) as the upgrade was low (0.1 percentage points for each year).. 
• Average number of COVID-19 infections increased in past 7 days, as well as those admitted to the hospitals. On the other hand, is the number of deaths lower, which is mainly due to continuing roll-out in vaccination. Number of people vaccinated with two jabs stands at 91 thousand (4.4 % of total) and number with minimum one jab at 8.6 %. We estimate the lower excess mortality as the most important element influencing the decisions of the policymakers. Nevertheless, we do not expect any significant relaxation in restrictiveness measures in the next week or two. In one of the regions (out of 12) measures were relaxed, whereas in one another (important for domestic tourism) restaurants may open and serve their guests outdoors. 

      Read also in the attachment about:

• Electricity consumption
• Number of registered unemployed
• Number of persons in employment in January 21
• January’s exports of services
• January’s exports of goods
• January’s average gross wage
• Transport indicators
• Value of construction output

On EU-27 

• Most of EU countries now face a third wave and large parts of France and Italy is back in lockdown, although the restrictiveness measures are carefully selected. The US on the other hand, continues to see improvement helped by the fast vaccine roll-out. We see April as the turning point in the management of pandemics, but there is a rising risk it drags into May in the EU due to the clearly more contagious British variant and a slow vaccination roll-out. Also, we cannot rule out this becomes an "endemic". In that case we would need to revaccinate particular risk groups and health care workers every year to provide protection. That scenario, however, is not as bad as ineffective vaccines and should be manageable.

    Read also in the attachment about:

• Serbia’s 2021 GDP growth
• Chart of the Week
• GDP growth forecast for 2021 for Poland

Must Read of the Week

• One in Five Companies in Germany Feels Threatened by Coronavirus Crisis (author: Ifo). Available in EN at: https://www.ifo.de/en/node/62207

Forecast of the Week

• Feb 21 Consumption of electricity (Statistical Office of RS): -2 % y-o-y

Comment: Reduction in restrictiveness measures in February providing an uplift in electricity demand (note: Jan 21: -4 % y-o-y).

Quote of the Week

“Most forecasts don’t allow for alternative outcomes.”
(Howard Marks)

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