Fiscal Stimulus To Continue

On December 30, the government of Slovenia announced plans to syndicate a benchmark bond worth at least EUR1.0bn in 2010 for budget financing. While a specific date for the issue was not released, it is likely to occur within Q110. The announcement of another major Slovenian bond issue reinforces our view that government external debt is set to continue rising alongside a continuation of fiscal stimulus measures in 2010. We forecast public sector debt to grow to EUR15.1bn by end-year, up from an estimated EUR13.7bn at end-2009. To be sure, with unemployment likely to remain in the double digits over

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