Plenkovic: EC report encouragement to gov't to continue reforms

The Croatian government on Wednesday welcomed the European Commission's report on Croatia as part of the European Semester 2020, in which positive economic indicators have been recognised, and Prime Minister Andrej Plenkovic said the report would encourage the government to continue working on reforms.

The government welcomes the EC report, which recognises positive economic indicators, especially efforts in the area of public finance and fiscal consolidation, the government said in a press release.

After the EC established in its last year's report that Croatia did not record excessive macroeconomic imbalances, for the first time since they were recorded in 2014, this year again the EC put Croatia among EU member states with stable economies.

In addition, rating agencies increased Croatia's credit rating to investment level, thus acknowledging responsible public finance management and the reform efforts which improve the business environment, the press release said.

"The government's approach, which is based on fiscal consolidation, structural reforms, and investments, has already resulted in an increase in disposable household income and in unburdening of the economy. The goal of all ongoing reforms is to continue boosting Croatia's competitiveness and increasing the standard of living of our citizens. The report encourages the government to continue working on reforms in all areas," said Prime Minister Plenkovic.

Croatian economy continued to grow in 2019 with a projected rate of 3% of GDP, and 2.6% and 2.3% of GDP in 2020 and 2021, which is twice the EU average growth rate in the period considered. Structural reforms, some of which were launched in 2019 and 2020, contribute to attaining long-term sustainable and higher economic growth rates. The European Commission's estimates on Croatia's economic growth are encouraging, and are even more optimistic than the government's," it was stated in the press release.

It was also emphasised that progress was recorded in all 14 areas for which recommendations had been given.

In the coming period, the government will focus on achieving full implementation of the National Reform Programme 2019, on which the assessment of progress in the implementation of recommendations is based, and especially on reforms of the public administration and health and judicial systems. Drawing up the National Reform Programme 2020 is also a priority, as is the implementation of measures within the Action plan for joining the Exchange Rate Mechanism II, which the Croatian government plans to finish by the end of May this year, the press release says.

Text: Hina

News