Public debt rises further in euro member Slovenia

(LJUBLJANA) - Eurozone member Slovenia's public debt pile grew still further in 2011 and is unlikely to shrink in 2012 despite efforts by the new government to rein in spending, the finance minister said Wednesday.

"I wouldn't dare say that debt will be lower by the end of 2012," Janez Sustersic was quoted by Slovenia's news agency STA as telling a parliamentary commission.

According to his preliminary estimations, public debt rose to 47.4 percent of gross domestic product or 16.8 billion euros ($22.0 billion) from 37.9 percent in 2010. In 2007 it was only 8.1 billion euros or just 23.4 percent of GDP.

The 2011 figures was also higher than expected, with the statistics office predicting in October 45.1 percent, while the European Commission had expected 45.5 percent. For 2012 Brussels projects an increase to 50.1 percent.

Sustersic said that over the last three years Slovenia's public deficit oscillated between five and six percent of GDP, forcing the state to borrow money and increase the former Yugoslav republic's debts.

The eurozone debt crisis, and more specifically worries about Slovenian public finances, with several debt agencies cutting their ratings, have also pushed up interest rates on the former Yugoslav republic's debt.

"The costs for servicing the debt amounted to 550 million euros in 2011, this year we estimate they will amount to 650 million euros," Sustersic said.

The statistics office is expected to publish the first official public debt figures in April.

The new centre-right government led by Prime Minister Janez Jansa came into power last month with a programme aimed at consolidating public finances by implementing austerity measures and structural reforms.