RACAN SATISFIED WITH TALKS WITH IMF OFFICIALS

ZAGREB, Feb 15 (Hina) - Croatian Prime Minister Ivica Racan on Friday expressed satisfaction with talks with representatives of the International Monetary Fund (IMF) on the implementation of the current stand-by arrangement, adding that the new arrangement, if granted, would be discussed subsequently. "What the next stand-by arrangement will be like and whether it will be granted at all will be discussed later," said Racan, who participated in a part of today's meeting of Croatian officials with members of the IMF Mission. Deputy Prime Minister Slavko Linic said after the two-hour talks the new arrangement had not been discussed. "We are interested in and want another arrangement, but that was not discussed at the meeting," Linic said. Talks on a possible new arrangement would start after the IMF Board of Directors decides about the current arrangement in late March, he said. Linic said the purpose of the mission's visit was to establish how the current stand-by arrangement was being implemented. He said that the Croatian government and the Croatian National Bank have agreed on the text of a letter to be sent to the IMF Board of Directors. The letter suggests that the completion of the arrangement be confirmed before its expiry in May this year. It also emphasises four priority tasks that are to be completed before the IMF Board of Directors adopts its decision at the end of March. Those are the implementation of the Law on Defence, forwarding into parliamentary procedure a bill on the privatisation of the Croatian Oil Industry (INA) and the Croatian Power Industry (HEP), the adoption of a law on employment, and the passing of a law on the privatisation of the Croatian Postal Bank (HPB), including the selection of the privatisation consultant and initiating the privatisation process. The letter also refers to last year's budgetary indicators which confirm that all plans have been achieved. The indicators show that we have managed to implement the envisaged programme and that there are no major objections in that regard, Linic said. Indicators on road construction investments show that funds for road construction are quite sufficient. Since we do not have our own capital for those projects, our responsibility towards investors is huge, Linic said. Addressing reporters after the meeting, Racan stressed Croatia could not give up ambitious development projects, such as the Zagreb-Split highway project, and that media reports about the IMF's criticism and refusal of the projects were unfair. "We will not and cannot abandon the strategic moves which we have made and intend to make and we have noted a high degree of understanding on the part of the IMF as regards our policy and conduct," Racan said. He described the talks on the implementation of the current stand- by arrangement as very good, adding they were held in a positive atmosphere, with the IMF representatives appreciating the situation in Croatia and the country's development efforts. He reiterated that the agreement with the IMF was based on the government's programme. Sometimes we receive requests from the IMF which we cannot accept, and then we negotiate about them, he said. The three-member IMF mission, headed by Hans Flickenschild, arrived in Croatia on February 6. The delegation held a news conference at the end of the visit today. (hina) sb rml