The 2005-2008 assistance strategy was adopted by the government in mid-November and the World Bank's Board of Executive Directors adopted it on December 21 last year.
The strategy focuses on Croatia's admission to the European Union, on its successful integration and not mechanical association with the EU, said the World Bank's director for Croatia, Bulgaria and Romania, Anand K. Seth.
He described the programme as ambitious, stressing that the strategy, in the high scenario, was aimed at implementing difficult reforms which would enable Croatia to join countries which achieve high growth rates.
Results will not be possible without pain, some reforms may be painful for citizens in the short run, so the strategy envisages a set of instruments to alleviate the consequences of the reforms, Seth said.
The World Bank's estimates state that in case of an accelerated growth and accelerated reforms, for example in the public administration and judiciary, particularly in the sector of infrastructure, Croatia would increase its economic growth rate towards 5.5 percent, encourage the growth of foreign direct investments to account for seven percent of GDP by 2007, etc.
The main instrument of the strategy are Programmatic Adjustment Loans - PAL, a series of annual loans in the next three years totalling from 150 to 200 million dollars annually.
Talks on the first PAL are expected to be completed in the first quarter of this year.
The second instrument are investment loans, of which four are envisaged this year. Talks on loans for a project of social and economic recovery and a science and technology project, each amounting to some 40 million dollars, should be completed in the first three months of this year.
A social welfare project (worth 30 million dollars) has been completed for the most part, and work is in progress on a loan for the adjustment of farming legislation to EU standards.
A new instrument of assistance are sector loans, which this year will be used for projects of modernisation of the education system and the reform of the health sector, each amounting to 75-100 million dollars.
The central topics of the strategy are macroeconomic stability as a precondition of growth, re-definition and restriction of the government's role and support to the private sector, participation in growth by diverse categories, and environmental sustainability.
According to World Bank projections, in the high scenario, half the amount stated in the strategy would refer to the area of administration and fiscal consolidation, social sectors would account for 18 percent of the funds, the environment for 17 percent, farming and rural development for eight, and infrastructure for seven percent of the funds.
Between 1993 and the end of 2004, the World Bank financed 24 projects in Croatia amounting to more than 1.2 billion dollars.