Speaking at a conference on the latest developments on the market of business credit reports, marketing lists, and purchasing information, Darren Middletich said that the consensus of political forces about Croatia's plans to join the European Union and about the fact that social and economic reforms are a must, helped improve the country's credit rating.
On the other hand, a slow judicial system, the impact of corruption on business activities and excessive red tape have negative effects on the credit rating.
Croatia's credit rating for May remains DB4c for the third consecutive month, according to the Dun & Bradstreet agency, which means that Croatia is viewed as a country of moderate risk for investment. The D&B report, released by the Zagreb-based company BonLine, said the International Monetary Fund praised "the sizable fiscal consolidation and advances in structural reforms" achieved under the stand-by arrangement during 2004-05, and that the IMF Executive Board had approved an extension of the arrangement until November 15.
Middletech said today that progress in the protection of intellectual property and property rights, the strengthening of the banking system and amendments to the bankruptcy law also helped enhance the credit rating.
However, some political risks such as problems about the adoption of the European Union constitution which could slow down Croatia's admission to the Union could produce negative effects, he added.
As regards the macroeconomic factors, the D&B analyst positively assessed the national currency's stability and a low inflation rate.
He added that Croatia's economic growth was moderate and that official forecasts for this and next year would perhaps be too optimistic.