Prior to its proclamation of an autonomous and independent state in 1991, Slovenia was a part of the Yugoslav federation and of its economic system based on public ownership and planned economy. In many respects, however, its initial position was more favorable than that of other countries in transition. By that time, Slovenia had namely developed many market elements. Its trading of goods was not limited solely to Eastern markets and its technological development was already on a higher level than in other socialist countries. Since the formation of prices and production had already largely adopted the principles of market economy politics played a less pronounced role in economic activities; contrary to this, the distinct influence of politics in human resources policy had been felt until the last days of the Yugoslav federation. Requests for change, which officially started in the spring of 1990, had been increasingly voiced since the second half of the 1980s. In the 1990-1992 period, Slovenia held a plebiscite, proclaimed independence, experienced a ten-day war, became internationally recognized, and ultimately became an autonomous state. The decision to become an autonomous and independent country enabled Slovenia to start implementing its own economic policy and thus assume responsibility for its economic development. The priority during this first phase of transition was to establish essential elements and institutions necessary for a successful function of a democratic country governed by the rule of law. Slovenia was among the first countries that were able to successfully overcome the period of transformational depression so typical of transitional economies at the beginning of the 1990s. The recovery of its economic growth and invigoration of domestic demand started to take place already in the middle of 1993. In a relatively short time it exceeded its pre-transitional level of economic activities; the level from 1990 was surpassed in 1996, and the level from 1987 in 1998. In the first half of the 1990s, the young country also managed to become a member of almost all prominent economic associations. There were marked structural shifts in ownership and scale structures. The activity-based added value structure indicated a decrease in industry and an increased importance of the service sector. As in other countries in transition, the most burning difficulties concerned the process of privatization. But Slovenia successfully overcame the transition from socialist to capitalist economy, with its economy becoming increasingly competitive and comparable to developed market economies.