CROATIA'S FOREIGN DEBT AT END OF MAY USD11.1 BILLION

ZAGREB, July 31 (Hina) - Croatia's foreign debt at the end of May totalled $11.1 billion, which is 217 million more than the month before when the foreign debt reached its highest level. Compared to late 2000, the foreign debt at the end of May was 238 million higher, the central bank said in its July bulletin. Recently, the state has increased its share in the foreign debt to 46.5 percent, while other sectors decreased theirs to 27.5 percent and banks to about 14 percent of the total amount. Direct investments account for 10.7 percent. Last year, the settlement of the foreign debt accounted for 19.9 percent of the overall export of goods and services. Also last year, the foreign debt accounted for 57 percent of the gross domestic product. According to the Finance Ministry, Croatia still is not over- indebted, although tendencies in the last few years are cautionary. At the end of 1997, for instance, the foreign debt amounted to $7.4 billion. A year later it reached $9.6 billion, rising to 9.9 billion at the end of 1999 and 10.8 billion at the end of last year. If such trends continue, Croatia could become a highly indebted country, the Ministry said, pointing to the need of caution in incurring debt in the future and using it more to pay past debts and less to finance the budgetary deficit. Last week, Finance Minister Mato Crkvenac said Croatia's indebtedness was tolerable and acceptable, although he warned current trends should be halted and possible new debts used to increase investments. (hina) ha