ZAGREB, July 8 (Hina) - Croatia's risk profile in July is marked by conclusions adopted after a two-week meeting of Croatian state officials and an International Monetary Fund delegation, and the country's rating has remained
unchanged at DB4d, reads the July report of the credit rating agency Dun&Bradstreet (D&B), carried by the Zagreb-based business information company Bonline.
ZAGREB, July 8 (Hina) - Croatia's risk profile in July is marked by
conclusions adopted after a two-week meeting of Croatian state
officials and an International Monetary Fund delegation, and the
country's rating has remained unchanged at DB4d, reads the July
report of the credit rating agency Dun&Bradstreet (D&B), carried by
the Zagreb-based business information company Bonline. #L#
The IMF representatives highlighted public finance as an area that
has limited any potential strengthening in Croatia's risk rating
and, alluding to the country's fairly high budgetary deficit,
voiced concern over the sustainability of Croatian public
expenditure. They also cautioned about the need to cut expenditure,
especially salaries in the public sector and the large transfers
directed towards the pension and health systems. The IMF has
concluded that the country's economic progress is stimulating,
with further trends of increase, a low inflation rate, and a stable
currency.
Further negotiation about a new stand by arrangement have been
postponed until September, when budgetary projections for 2003
should be drawn up. D&B expects that fiscal projections for next
year will enable a new credit arrangement with the IMF.
According to the report, the more important economic events in June
include the further liberalisation of trade between Croatia and
Macedonia, the improvement of liquidity in the banking sector,
resulting in increased loans to citizens, etc. D&B analysts warn
that the positive effects of intensified loan activities,
increased domestic spending, and investments will be "spoiled" by
increasingly poor export results. Croatia's foreign trade deficit
in the first four months of this year increased by more than 15
percent on the inter-annual level.
DB4d credit rating mark, which Croatia has been receiving for a
number of months, stands for countries of moderate investment
risk.
Heading the list of Central and East European countries, with the
best credit rating of DB2d, are Hungary and Slovenia, followed by
the Czech Republic and Poland (DB3b), and Estonia (DB3c).
Yugoslavia, Uzbekistan, Turkmenistan, Tajikistan, Georgia,
Belarus, and Albania are at the bottom of the scale with a rating of
DB6d.
(hina) rml