LJUBLJANA (Slovenia), November 28 (SeeNews) - The Organisation for Economic Co-operation and Development (OECD) said on Monday it has upgraded its economic growth forecast for Slovenia to 2.0% in 2016 and 2.4% in 2017, from 1.5% and 2.3%, respectively, on the back of rising private consumption.

Investments in Slovenia will pick up as renewed EU structural funds bolster infrastructure investments, firms react to capacity constraints, and housing construction responds to higher property prices. Inflation is set to increase as economic slack will disappear in 2018, the OECD said in its November economic forecast.

The bank recommends that Slovenia focus on reforms to get the long-term unemployed back to work and to use fiscal tightening to prevent inflationary pressures. The sale of state-owned enterprises would promote competition and help maintain the gains made in international competitiveness, the OECD said.

Public debt is estimated to rise to 85% of GDP by the end of 2016 and interest payments to increase to almost 3% of GDP. "The structure of fiscal policy could be more supportive on the supply side by moving the tax burden from labour towards property and shifting some spending on the unemployed in favour of training rather than passive income support," the bank added.