PM Plenkovic: Intensive work lies ahead that should result in settlement plan for Agrokor creditors

Croatian Prime Minister Andrej Plenkovic said on Thursday that great effort had been invested in the last ten months to prevent the crisis in the ailing Agrokor food and retail group from escalating and negatively affecting the national economy, noting that now intensive work lay ahead that should result in a settlement plan for the corporation's creditors.

The government today adopted a report on the implementation of the Act on Emergency Administration in Companies of Systemic Importance for Croatia in the period until 10 January 2018.

Plenkovic said that he believes that the Agrokor crisis had been contained and that now intensive work lay ahead that should eventually result in a settlement plan and help companies that were part of the Agrokor group continue generating revenues and keep jobs, without the state having to intervene with budget money.

Economy Minister Martina Dalic said that the report reflected the government's legislative efforts, as well as the efforts of Agrokor's emergency administration, which, she said, had helped keep a large number of jobs, ensuring normal conditions for economic growth and a normal course of the tourist season as well as a normal situation with public finances, resulting in a recent upgrading of Croatia's credit rating.

"The operation of Agrokor d.d. has been preserved and stabilised in a way that ensures positive earnings before, interest, taxes and amortisation, both at the level of the entire system and at the level of the most companies making up the group," said Dalic, adding that this was owing to a new loan provided last June by Agrokor's financial creditors and efforts by its emergency administration.

Of that loan, EUR 150 million has been spent mostly on the payment of debts to suppliers, which had been incurred before the establishment of the emergency administration, i.e. before January 10, 2017, said Dalic.

In the process of emergency administration suppliers have so far been paid 50% of their claims, with small suppliers having been paid fully, she said, adding that the payment of debts to medium and big suppliers was underway.

The draft settlement plan for Agrokor refers to the entire system and Dalic believes that the results achieved so far provide a good foundation to hammer out and agree on a settlement within legally prescribed deadlines, without any costs for taxpayers.

The government on Thursday adopted memorandums of consent which the Science and Education Ministry signed with the University of Magallanes from Chile and the National University of Rosario's Faculty of Humanities and Arts from Argentina and an agreement with the University of Buenos Aires Faculty of Philosophy and Literature, on setting up a Croatian language and literature instructorship.

The purpose of the memorandums and the agreement is to step up linguistic, educational and cultural cooperation between Croatia and Chile and Croatia and Argentina in order to encourage students to study the Croatian language and literature.

The Croatian Science and Education Ministry will pay the instructors' monthly salary and provide the necessary literature, while Chile and Argentina will pay for the costs of accommodation and facilities where classes will be held, Science and Education Minister Blazenka Divjak said.

"These agreements are very good for the promotion of the Croatian language and literature," Prime Minister Andrej Plenkovic said.

The government also endorsed a report on the work of the Croatian News Agency (HINA) for 2016.

Hina has been been doing business in the black for the past three years and in 2016 its profits amounted to more than HRK 800,000. In accordance with the Law on Hina, the money was reinvested into further technological development and the supply of computer, photo and video equipment, Culture Minister Nina Obuljen Korzinek said.

The government also accepted the sponsorship over the celebration of the 50th anniversary of the performance of the "Exercise in Style" play.

"Although it is not common for the government to give sponsorship to individual theatre plays, Exercise In Style is a global phenomenon," the culture minister said, adding that the play has been in theatres for the past 50 years.

Text: Hina

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