PM says national reform programme has 3 goals

The national reform programme which the government will present on Thursday, together with a convergence plan for the next three years, has three goals - boosting the economy's competitiveness, increasing employability, and maintaining public finances, Prime Minister Andrej Plenkovic said on Wednesday.

Addressing entrepreneurs at a meeting organised by the Croatian Employers Association (HUP), he said the national reform programme covered 12 areas and comprised 51 measures.

"The country's political stability is the basic message we wish to send to the public, notably in relation to the turbulent 2016. That presumption is key for raising competitiveness, for job creation, for higher economic growth and development. Also important to us are demographic revival, legal security, and we can achieve all that if in the policies we pursue and the laws we adopt we see to social solidarity and equity," Plenkovic said.

Commenting on the latest data on the government deficit and the public debt in 2016, he said the fiscal stability policies, including the lowest deficit  to date and the reduction of the public debt, had been good measures and that it was important to pursue a rational policy of budgetary discipline.

Together with a stable legal framework, these are the pillars on which our government will base its action. It's good that investments, personal consumption and industrial production are growing because they let us know that the Croatian economy has contributed to those trends and that we are driving economic growth on sound foundations," Plenkovic said, adding that he would pursue social dialogue with all key social partners.

He said para-fiscal levies would be reduced by another 20% and that the government wished to improve the management of state assets.

He also said the education and curriculum reforms were topics on which there was no dispute.

Speaking of the ailing Agrokor retailer, he reiterated that the government had moved a bill on systemically important companies because the situation had been extraordinary, to stabilise the situation and prevent "undesired chain reactions" in the economy.

Privredna Banka Zagreb CEO Bozo Prka said the Agrokor situation could cause "concentric circles" and that "it's clear to everyone that several... companies will enter the pre-bankruptcy settlement system."

He said the pre-bankruptcy settlement law should be amended to include the senior loan status institute for new lending to companies undergoing pre-bankruptcy settlement.

Economy Minister Martina Dalic said the restructuring of Agrokor was one of the biggest reforms in the economy which the government had not anticipated.

HUP president Gordana Deranja welcomed the tax reform and the government's response to the Agrokor crisis. "It encourages our expectations that the government will have the will and the determination to reform the health sector, education, the judiciary and the public sector."

Text: Hina

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