CENTRAL BANK MARKS FIVE YEARS OF STABLE NATIONAL CURRENCY

ZAGREB, May 28 (Hina) - The Croatian National Bank (HNB) marked the fifth anniversary of the national currency kuna at a session of the HNB Council, held in Zagreb on Friday. The session was attended by the members of a commission to introduce the Croatian currency, Dalibor Brozovic and Nedjeljko Mihanovic, the HNB reported. When on Statehood Day of 1994, the HNB exchanged Croatian dinars for the first kuna bills for Croatian President Franjo Tudjman, few believed that after the first five years of the kuna one would be able to speak of it as one of the most stable currencies of countries in transition, HNB Governor Marko Skreb said in his introductory speech. However, in the past five years, the kuna proved to be one of the most stable transition currencies. At the time of its introduction, the exchange rate of the kuna in relation to the German mark was 3.72, and today it is 3.88, which means that in the five years the kuna lost 4.3 per cent of its value, which is less than one per cent annually. In 1994, foreign exchange reserves amounted to about US$900 million, while today gross foreign exchange reserves on HNB's accounts amount to about US$2.6 billion. In the same period, the annual inflation rate was approximately 3 per cent. During the five years of kuna, the average gross salary in Croatia increased by 89 per cent, and the average pension by 83 per cent. In this period, money supply rose from 5.3 billion to more than 12 billion kuna, which represents an average annual increase of more than 18 per cent, it was said at today's session. (hina) rml