ZAGREB, Jan 19 (Hina) - The Euro is bringing changes to relations on the global market to which Croatia also must adjust, a representative of the Croatian National Bank, Boris Vujcic, said in Zagreb on Tuesday at a lecture on the
significance of the Euro for the European union and Croatia. The lecture took place under the organisation of the Croatian Government's Office for European Integrations, and began a cycle of weekly lectures on Croatia and the EU. The Euro is responsible for creating a big and liquid market of a united Europe, which is becoming more attractive for investments. This will unavoidable reflect on Croatia which has had difficulty in attracting foreign investments anyhow, Vujcic said. With the establishment of the Euro zone, Croatia is entering a tri-polar world: Euro-dollar-kuna. The kuna currency rate to the Euro will depend on the internal economy policy, so Croatia can influence the risks. I
ZAGREB, Jan 19 (Hina) - The Euro is bringing changes to relations on
the global market to which Croatia also must adjust, a
representative of the Croatian National Bank, Boris Vujcic, said in
Zagreb on Tuesday at a lecture on the significance of the Euro for
the European union and Croatia.
The lecture took place under the organisation of the Croatian
Government's Office for European Integrations, and began a cycle of
weekly lectures on Croatia and the EU.
The Euro is responsible for creating a big and liquid market of a
united Europe, which is becoming more attractive for investments.
This will unavoidable reflect on Croatia which has had difficulty
in attracting foreign investments anyhow, Vujcic said.
With the establishment of the Euro zone, Croatia is entering a tri-
polar world: Euro-dollar-kuna. The kuna currency rate to the Euro
will depend on the internal economy policy, so Croatia can
influence the risks.
It cannot, however, influence the relation between the kuna and the
dollar. One third of Croatia's companies (INA oil company,
Ericsson-Tesla) which are doing transactions in dollars, will have
to protect themselves with the so-called hedging strategy
(ensuring exchange risk) between the Euro and the dollar, Vujcic
said.
A new danger is hidden in the possible movement of the stronger
venture capital towards the exchange of exotic countries, such as
Croatia, Vujcic warned.
Venturers have so far been interested in the Italian Lira, and now
they will turn towards other currencies tied to a strong exchange
rate, such as the Croatian kuna connected to the German mark.
Croatian bankers are defending themselves against the possible
introduction of venture capital, aided by the current global
financial crisis.
Besides the potential dangers, the European Monetary Union can open
new opportunities for Croatian exports.
If the EMU market produces a greater demand, "chances for Croatian
exports will increase", Vujcic said. He added restructuring of the
economy would be needed for this to take place.
Although still waiting, Croatia should not do so with its arms
crossed, but restructure its economy and get ready for European
integration processes, Croatian Integration Minister Ljerka
Mintas-Hodak said.
(hina) lml jn