The talks focused on specific reform policies, structural reform, preliminary estimates of economic trends, projections for 2006, and Croatia's desire to extend the existing stand-by arrangement for another seven months.
Underlining the importance of the Parliament's role in overseeing and implementing the stand-by arrangement, Demekas said that a low rate of inflation, Gross Domestic Product growth and reduction of the government deficit were positive indicators.
He, however, noted that reduction of the government deficit was not enough to reduce a very high public debt, and added that the private sector's foreign borrowing was on the rise, resulting in a significant current account deficit and an increasing foreign debt.
Although the foreign debt growth rate has been reduced, it still poses a risk to the Croatian economy, Demekas said.
The IMF believes that the macroeconomic picture is good in general, but that it is necessary to lower the foreign debt by reducing government costs, especially social contributions.
Prtenjaca cited structural disruptions as a major problem of the Croatian economy, adding that the problem could be overcome by increasing production, encouraging development projects and reducing unemployment.
Earlier this week the IMF Mission resumed a second review of the stand-by arrangement with Croatia.