Over the past decade, Slovenia has experienced steady economic growth and increasing international competitiveness, with average real GDP expanding by 2.9% per year, above the OECD average of 2.3%, unemployment dropping to a historic low of 3.7% in 2024, and goods exports as a share of GDP remaining among the highest in the European Union, making the country a clear regional success story.

Yet the latest OECD analysis published in January paints a more uneven picture beneath these national achievements. Economic gains have not been shared equally across Slovenia’s regions, and long-standing structural challenges threaten to deepen regional disparities unless they are addressed through coordinated and sustained policy action.

One of the most significant long-term pressures is demographic change. By 2060, the share of elderly residents in Slovenia is expected to reach 30%, with rural, industrial and remote regions facing the sharpest impact. Ageing populations will strain local healthcare and social services, reduce labour force participation and weaken economic dynamism, particularly outside the capital region.

Spatial-planning constraints compound these challenges. Less developed regions often face shortages of suitable land for industrial activity, while lengthy and complex construction permit procedures deter potential investors. At the same time, Slovenia’s transition towards net zero emissions is placing uneven demands on regions, especially those historically dependent on coal mining and energy-intensive industries.

Ljubljana’s gravitational pull

The OECD highlights a stark divide between Osrednjeslovenska, home to the capital Ljubljana, and the rest of the country.

GDP per capita in Osrednjeslovenska reached €44,600 in 2024, almost 50% higher than the national average of €30,200, and more than double the level recorded in Zasavska, Slovenia’s least developed region, at €16,500. 

This gap has widened over the past decade, driven by the concentration of investment, innovation and talent in and around Ljubljana.

In 2023, Osrednjeslovenska attracted 58.9% of foreign direct investment (FDI) and accounted for 58.4% of national R&D expenditure.

Universities, research institutes, government institutions and corporate headquarters reinforce the capital’s economic dominance, drawing skilled workers and businesses from other regions.

“In 2023, Osrednjeslovenska’s GDP was more than €25bn, 25 times larger than Zasavska, Slovenia’s smallest regional economy,” OECD said in a report.

The OECD describes this phenomenon as Ljubljana’s “strong gravitational pull”. While it has helped power Slovenia’s overall economic success, it has also left other regions struggling to compete for investment, talent and opportunities, widening disparities in income, employment and quality of life.

Zasavska’s legacy of deindustrialisation

Nowhere are these challenges more visible than in Zasavska, a small region along the Sava River historically shaped by coal mining and heavy industry.

Towns such as Trbovlje, Zagorje ob Savi and Hrastnik once relied on mining and associated industries as their economic backbone. The closure of mines and the decline of heavy industry, however, have left the region with limited economic diversification, high dependence on public-sector employment and persistent outmigration.

Geography adds to the problem. The narrow, hilly terrain of the Sava Valley restricts the availability of industrial land and limits large-scale development. With a population of just over 55,000 and fragmented municipal structures, Zasavska struggles to generate the scale needed to attract private investment or develop modern economic clusters.

Young people frequently leave for Ljubljana or other regions in search of education and employment, accelerating population ageing and weakening the local labour market. As the OECD notes, such social and economic disparities directly undermine productivity, workforce participation and regional attractiveness.

The coal transition challenge

The neighbouring Savinjsko–Saleska (SASA) region, anchored by Velenje and the Sostanj thermal power plant, faces similar but more complex challenges. Coal mining and energy production have long provided economic stability and relatively high wages, but the planned phase-out of coal threatens jobs, municipal revenues and local supply chains.

Recognising the scale of the challenge, Slovenia has begun to translate the OECD’s recommendations into concrete policy measures focused on just transition and regional restructuring.

In October 2025, SPIRIT Slovenia, the public agency for entrepreneurship and investment, launched a €68.7mn public tender to support sustainable investment and job creation in the Zasavska and SASA coal regions. The tender is financed by the EU’s Just Transition Fund under the 2021–2027 European Cohesion Policy Programme and targets areas most affected by the coal phase-out.

Of the total amount, €26.2mn is earmarked for Zasavska and €42.5mn for the SASA region for the 2025–2028 period. The funding will co-finance investments in tangible and intangible assets, including facilities, machinery and equipment, and is open both to established companies and younger firms, reflecting the need to support entrepreneurship alongside industrial transformation.

Energy transition projects are also under way. The Ministry of Cohesion and Regional Development has approved EU funding for the construction of the Prapretno II and III solar power plants, together with a battery storage system, on a former ash and slag landfill near Trbovlje.

The €13.6mn project, implemented by state-owned Holding Slovenske elektrarne, will receive €4.08mn from the Just Transition Fund and is intended to reduce emissions while rehabilitating environmentally degraded land linked to coal use.

A legislative framework for transition

A major step followed in December 2025, when the Slovenian government adopted the Act on the Developmental Restructuring of the Savinjsko–Saleska (SASA) coal region, creating a framework to manage the social and economic impact of the coal phase-out in line with just transition principles.

Cohesion and Regional Development Minister Aleksander Jevsek said the law is intended to become a new development driver for the region, supporting economic growth, job creation, improved living conditions and new infrastructure, while addressing the early closure of the Velenje coal mine and the phase-out of coal at the Sostanj thermal power plant.

“I would like to emphasise that the intensive restructuring of the SASA region has already been underway for some time, with the Just Transition Fund support under the European Cohesion Policy. The Fund was established to help coal regions, which have been economic growth engines for decades, enter a new phase of green technologies, low-carbon production, and energy efficiency,” Jevsek said in a ministry’s statement.

Jevsek described the legislation as a horizontal act, involving all relevant ministries in its design and implementation, responding to OECD concerns over fragmented governance.

The act provides for development programmes for 2026–2030 and 2031-2035, with funding of up to €282.2mn from EU cohesion funds, the state budget and municipal resources.

Key projects include district heating upgrades in the Saleska Valley, conversion of the Sostanj energy site to renewables, development of a start-up and scale-up valley, and preservation of the Coal Mining Museum of Slovenia, alongside support for the cultural and creative sector.

From strategy to delivery

While these measures represent a significant step forward, the OECD cautions that long-term success will depend on governance capacity, financing stability and performance measurement. Subnational public investment in Slovenia accounts for just 37.3% of total public investment, well below the OECD and EU averages. Regional development agencies remain heavily dependent on project-based EU funding, limiting their ability to plan strategically.

As the country navigates the coal phase-out and demographic change, the experience of Zasavska and the SASA region will be a critical test of whether economic success can be made more inclusive.

Slovenia’s national regional development strategy represents a significant opportunity to address these structural challenges, reduce inequalities, and ensure that the benefits of economic growth are more evenly shared. But without careful attention to governance, financing, and performance measurement, the gravitational pull of Ljubljana could continue to deepen regional disparities