PM says important to implement national reform programme to strengthen economic potential

Prime Minister Andrej Plenkovic on Thursday commented on recommendations the European Commission gave to Croatia, saying that it was a good thing that the EC recognised efforts the government had made in the fiscal consolidation sector, adding that it was important to implement the national reform programme in order to strengthen the potential of Croatia's economic growth.

At the start of the government session on Thursday, the prime minister commented on the recommendations the European Commission gave to Croatia, saying that it was good that there this year there were less recommendations than the year before.

"It is good that this year we have less recommendations that the year before, This is a sign that we did a good job on the national reform programme. This time, everything that the European Commission recommended has already been included in our plan, which means that we recognised the trends well," Plenkovic said.

He underscored that it was exceptionally important that the European Commission had recognised the efforts the government made in the fiscal consolidation sector, adding that the results were better than expected. He said that headway was made in the process of managing the public debt which was shrinking faster than in other EU member states. Plenkovic also recalled that last year Croatia left the excessive Deficit procedure.

"I believe it is no surprise that in 2017 financial institutions and agencies raised our credit rating for the first time since 2004," Plenkovic said, adding that the government would continue its work in the fiscal consolidation sector and further reform.

The PM underscored it was important to achieve three priority objectives from the national reform programme, together with other measures, and in that way strengthen Croatia's economic growth potential.

The government in April sent to the European Commission a 130-page National Reform Programme, containing 59 concrete measures in 11 reform areas. The three key objectives of the document are strengthening Croatia's economy competitiveness, connecting the education system with the labour market and achieving the sustainability of public finances.

The European Commission on Wednesday gave Croatia four recommendations which Zagreb is expected to carry out this and next year and which are mostly the same as those given in 2017.

In the first recommendation, Croatia is required to strengthen its fiscal framework and introduce real estate taxes, based on the value of the real estate.

In the second recommendation, Croatia is expected to discourage early retirement, accelerate the transition to the higher statutory retirement age, and align pension provisions for specific categories with the rules of the general scheme.

In the third recommendation, Croatia is expected to reduce the fragmentation and improve the functional distribution of competencies in public administration.

In consultation with social partners, it is expected to harmonise the wage-setting frameworks across the public administration and public services.

In the fourth recommendation, Croatia is expected to improve corporate governance in the state-owned enterprise sector and speed up the divestment of state-owned enterprises and inactive state assets.

Croatia is also expected to significantly reduce the burden on businesses stemming from costs of regulation and from administrative burdens; to remove regulatory restrictions hampering access to and the practice of regulated professions and professional and business services; and to improve the quality and efficiency of the justice system, in particular by reducing the duration of civil and commercial cases.

The recommendations are part of the spring package of the European Semester which the Commission publishes each year in May.

Text: Hina

News