ZAGREB, Dec 10 (Hina) - Finance Minister Mato Crkvenac stated on Tuesday that talks with members of an International Monetary Fund (IMF) mission on a possible new stand-by arrangement between Croatia and the IMF would end today. The
government will decide whether to sign a new stand-by arrangement in early January next year.
ZAGREB, Dec 10 (Hina) - Finance Minister Mato Crkvenac stated on
Tuesday that talks with members of an International Monetary Fund
(IMF) mission on a possible new stand-by arrangement between
Croatia and the IMF would end today. The government will decide
whether to sign a new stand-by arrangement in early January next
year. #L#
After talks with the IMF on the level of experts are finished, the
government, parliament, social partners and the ruling coalition
will have to decide if they want the arrangement with the IMF.
Preconditions have been secured for the arrangement, Crkvenac said
at a news conference at the ministry building in Zagreb.
The arrangement brings significant privileges for Croatia, but the
current situation, considering the projected deficit and foreign
reserves, gives Croatia a stable position on the international
financial market, regardless of whether it signs the arrangement or
not, he said.
The IMF mission arrived in Croatia last week and on Friday started
final talks on a new stand-by arrangement.
Minister Crkvenac said that there were no major differences between
the two sides regarding Croatia's economic policy.
He stressed that next year's economic policy, budgetary deficit and
state deficit were defined by the government. "It was our decision
that the state deficit must not exceed five percent because a higher
deficit would mean a relative increase of the country's
indebtedness," Crkvenac said.
The issue of deficit was one of the most contentious during October
talks with the IMF mission.
The Croatian parliament on Friday adopted the state budget for
2003, with expenses totalling 87.6 billion kuna. The new structural
elements of the budget include a five-percent decrease in the state
deficit. Of this percentage, investments account for 2.5% while the
state deficit accounts for 2.2%.
Next year's budget is oriented towards science and education and
the implementation of reforms. The budget supports investment
activities and saves funds, Crkvenac said.
Speaking about the main characteristics of Croatia's fiscal and
financial policy in the last three years, Crkvenac pointed to a
continual economic growth, high macroeconomic stability and a low
inflation rate, as well as to Croatia's constantly improving rating
on the international market, good liquidity, and lower interest
rates. All this has contributed to an increase in investments,
which this year rose by 12%, the minister said.
(hina) rml sb