"Although their manifestations are very similar, the causes of the crises in the global economy and in our country are not the same, and their gravity is also not the same, nor are the responses and ways of overcoming them," Rohatinski said.
The crisis in Croatia was not generated by the financial system, as was the case in the global economy, but was caused by the collapse of the entire economic model from the past 10 years, based primarily on the influx of foreign capital that was not used to build an export-oriented, competitive economy capable of reducing the net external debt, the governor said.
He said that the crisis would have hit Croatia even if there had been no global crisis.
However, the global crisis caused an external shock for the domestic economy which had already accumulated imbalances and irrationalities, he said, adding that Croatia was not braced for such developments as it ignored all warnings.
Rohatinski said that at one moment the central bank had released one third of available foreign currency holdings in order to avoid a moratorium on Croatia's external liabilities. The alternative was to ask the International Monetary Fund for assistance, he said adding that "both the government and I thought that it was not necessary and that we could recover from the crisis on our own, if we follow competent advice". Rohatinski said that he now deemed this to have been a mistake.
He said that the price of the national economic crisis in 2009 and 2010 was a decline in Gross Domestic Product of 7.4 percent, a drop in employment of 8.4 percent, and a decrease of the wage budget of 9.7 percent. In addition, personal consumption contracted by 10.5 percent and investments by 22.1 percent, according to the governor.
The central bank projects this year's economic downturn at 1.9 percent.
The HNB, similarly as the government, forecasts an upturn of 1.5 percent in 2011.
The starting position for 2011 is meagre. With the GDP rise of 1.5 percent, the current account deficit is likely to reach 4 percent of GDP, and the external debt rise to 103 percent of GDP from this year's 101 percent. The fiscal deficit is estimated at 6 percent of GDP, he said.
Rohatinski said that a substantial reduction of the budget deficit required restructuring expenditures and encouraging investments into export-oriented production rather than into infrastructure.
"The response to the crisis was lukewarm, there have been attempts to patch up holes without making essential changes. We are not yet ready for changes and we still believe that the recovery of the global economy will pull our economy out of the crisis. This will not and cannot happen, as it would mean going back to the economic model from the period before 2008, but others will not let us do it," he said.