The 20-month stand-by deal worth 140 million dollars was approved by the IMF in early August, and the Ivo Sanader cabinet intends to treat it as a precautionary measure, and not to draw any funds from it.
Suker told MPs that at the time when it was evident that Croatia would be granted a positive opinion on its application for European Union membership, the government could not afford to see Croatia regarded as a country with inaccurate financial reports.
He added that the new stand-by deal was characterised by the fact that a 6.3 percent GDP deficit had been registered instead of the previously agreed 4.6 percent deficit, which was why the previous stand-by arrangement, concluded by the former government and the IMF, could not be completed.
The minister reiterated that the incumbent government was planning to record a state deficit of 9.3 billion kuna (or 4.5 percent of GDP), stabilise the share of the foreign debt in GDP, strengthen fiscal discipline, as well as continue implementing the most important infrastructure projects.
With regard to privatisation, Suker said that until the end of 2005, the government would sell at least 15 percent of shares in the INA oil company, and draw up a privatisation plan for the Croatian Osiguranje insurance company by the end of June next year. It also plans to continue privatisation in the banking sector.
During a debate on this topic, clubs of opposition deputies accused the Sanader cabinet of concluding the stand-by arrangement despite the parliament's ban. They also expressed fear that the new deal would decelerate economic growth and the implementation of the most important projects.
Zlatko Tomcic of the Croatian Peasant Party (HSS) said he did not believe that the deal would help solve the burning issues in the field of economy, such as the poor competitiveness of the national economy, high unemployment, and insolvency.
Tonci Tadic of the Croatian Party of Rights (HSP) said the government could have concluded a much better deal if it had had a clear strategy for economic recovery. He also proposed that privatisation be carried out only in telecommunications, power and transport sectors.
Slavko Linic of the Social Democratic Party (SDP) pointed out a low projection of the growth between 3.5 and 3.75 percent of GDP as one of the biggest problems saying rates that were so low could not help development projects or engage the public sector in the economy.
Radimir Cacic of the Croatian People's Party (HNS) said the government's plans actually meant the discontinuation of the rapid economic growth.
Damir Kajin of the Istrian Democratic Assembly (IDS), however, believes that no responsible government can afford noncooperation with the IMF or the UN war crimes tribunal in The Hague.