ZAGREB, Sept 28 (Hina) - Inflation will remain at a reasonable and controlled level because a recent increase of excise tax had a short-term effect and did not influence other prices, Croatian National Bank (HNB) governor Zeljko
Rohatinski said Thursday in the Croatian national parliament. In the first eight months of this year, retail prices increased by 5.3 percent, of which three percent was immediate effect of the increase of excise tax and prices of oil products. In case this failed to take place, inflation would amount to about 2.3 percent, the HNB governor said after a discussion on reports of the central bank in parliament's House of Representatives. During the discussion, MPs criticised the HNB report for 1999 the most. The most common complain referred to low profit, failed credit volume, and great loan loss reserves for bankrupt banks. On behalf of the Social Democratic Party's (SDP) parliamenta
ZAGREB, Sept 28 (Hina) - Inflation will remain at a reasonable and
controlled level because a recent increase of excise tax had a
short-term effect and did not influence other prices, Croatian
National Bank (HNB) governor Zeljko Rohatinski said Thursday in the
Croatian national parliament.
In the first eight months of this year, retail prices increased by
5.3 percent, of which three percent was immediate effect of the
increase of excise tax and prices of oil products. In case this
failed to take place, inflation would amount to about 2.3 percent,
the HNB governor said after a discussion on reports of the central
bank in parliament's House of Representatives.
During the discussion, MPs criticised the HNB report for 1999 the
most. The most common complain referred to low profit, failed
credit volume, and great loan loss reserves for bankrupt banks.
On behalf of the Social Democratic Party's (SDP) parliamentary
bench Josip Leko criticised the central bank for increasing
negative macroeconomic trends - economy marked a decrease, the
unemployment rate increased, while interest rates remained at a
very high level. According to Leko, the central bank is also to be
blamed because it had a significant role in the establishment of the
economic atmosphere. This is why SDP representatives will not
endorse the HNB report for 1999, considering obvious positive
changes in the HNB policy, Leko said.
Concluding, Rohatinski said nobody can expect him to take the
responsibility for the situation in 1999, given that he took over
the duty of the HNB governor only recently, and that he did not wish
to change the report for 1999 because it had been composed before
his arrival. He, however, added he would immediately offer his
resignation on representatives' request.
Several MPs criticised the central bank for the statue of
limitation for criminal charges against bankers who made banks go
bankrupt. Rohatinski said a part of the blame should indeed be put
on the central bank, and added, however, a part of the blame should
be put on judiciary.
MPs also criticised the HNB for having high business expenses.
According to the governor, since his arrival, he and other heads of
the bank haven't spent a kuna on furniture, paintings, etc.
The lower house unanimously endorsed the HNB financial plan for
1999, however, it failed to endorse the financial report as well as
HNB's annual report for 1999.
The first fall session of the House of Representatives is to be
continued this afternoon.
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