It said in a statement that foreign risks are increasing and could "cause an even bigger slowdown of economic growth than forecast at present, which further increases short-term and medium-term risks for public finances".

"Economic growth in the euro zone slowed down in the first quarter while uncertainty has increased due to the danger of rising protectionism and trade conflicts," it added.

The council expects Slovenia to reach the planned budget surplus of 0.4 percent of GDP this year versus a surplus of 0.03 percent in 2017.

Earlier on Thursday the European Commission cut the GDP growth forecast for Slovenia to 4.4 percent versus 4.7 percent it forecast in May, citing expected slower growth of foreign demand for Slovenian products.

Slovenia exports about 70 percent of its production, mainly to other European Union states. Main exports include cars, car parts, pharmaceutical products and household appliances.

The country held a general election on June 3 but parliamentary parties have so far failed to agree on a government coalition. President Borut Pahor has until July 22 to nominate a candidate for prime minister.

The Council said the new government will from the start be faced with many key decisions "which must ensure public finance sustainability", citing the need to reduce the burden of the ageing population on the budget.

The Bank of Slovenia on Wednesday urged the future government to keep tight budgets and reduce public debt which is expected to fall to 69.3 percent of GDP this year but will remain well above the 60 percent of GDP level allowed for EU members..