CRO NATIONAL BANK GOVERNOR - KUNA RATE WON'T CHANGE SIGNIFICANTLY

ZAGREB, Feb 12 (Hina) - Croatian National Bank (HNB) governor Marko Skreb on Friday said the HNB estimated no significant changes in the kuna rate should be expected in the course of this year. Skreb addressed a two-day convention called "Monetary Policy in 1999", which began on Friday and gathers the presidents and members of banks' and savings banks' administrative and supervisory boards. The majority of HNB's measures in 1998 were aimed at cutting the high deficit on the balance of current transactions, Skreb said. According to statistics, the said deficit reached 12.5 percent of the Gross National Product (GNP) in 1997. As yet incomplete data for 1998 show a decrease in the deficit to approximately 7.5 percent. In 1999, the HNB estimates the deficit will further drop to 5.5 percent of the GNP which, said Skreb, may be considered as satisfactory. He pointed out however a desirable drop should be to three percent. Skreb said Croatia's trade balance deficit in 1998 was US$1.1 billion less than in 1997. Export last year was 13 percent higher in kuna denominations, or nine percent in US dollars. In 1999, a modest 1.5-2 percent economic growth may be expected, the governor said, adding in the first six months Croatia will witness stagnation, while progress will be recorded in the second six months. Inflation this year will revolve around 3-4 percent which, Skreb said, is a necessary condition of further transition. (hina) ha mm