New investments are a must, or a long period of low growth rates is ahead of us. This requires an active government policy for attracting foreign direct investments, Josipovic said.
Commenting on the current state of affairs in the Croatian economy, he said, "I am not afraid as I believe in Croatia and in institutions, even when indicators are not as we would like them to be".
This situation is no reason for "desperation but an encouragement to solve problems," he said.
The economic policy, which is one of the main priorities alongside the country's aspiration to join the European Union, must be carried out through efficient administrative, social and economic reforms, the president said.
He called for the creation of a favourable climate for doing business in Croatia, warning that very little had been done to remove obstacles for investors.
The president presented projections about an economic downturn of 1.5 to 2 percent and high unemployment in 2010.
The recession is weakening and a slight rise in Croatia's Gross Domestic Product can be expected in 2011, according to Josipovic's speech.
He warned about the budget deficit going around 6 percent of the GDP and about the increase of the public debt to 50 percent of GDP, with the external debt accounting for some 100 percent of GDP.
Josipovic said that it was good that the government had launched a comprehensive Economic Recovery Programme, which he said must be implemented to overcome the crisis and create prerequisites for sustainable economic growth.
He also called for the preservation of macroeconomic stability.
Addressing the conference organised by the Croatian Economists' Society, its president Ljubo Jurcic said that Croatia would stagnate with or without the International Monetary Fund if the country did not pursue its own policy.