GOVERNMENT DISCUSSES PROBLEM OF ILLIQUIDITY

ZAGREB, June 24 (Hina) - The Croatian Government on Thursday discussed the problem of illiquidity. At today's session the Government ordered to the commission for implementation of measures for the resolution of illiquidity to propose ways of treatments of firms the accounts of which are blocked for longer than 360 days. The commission should draw lists of 300 biggest defaulters. Finance and Economy Ministers, Borislav Skegro and Nenad Porges respectively, believed that the problem of illiquidity in firms and their creditors is not the concern of the Government. This problem should be solved in courts and not by a monetary policy and some actions of the executive authority, Skegro said. There is nothing like the struggle against illiquidity, movements, fronts, but we should agree whether we shall respect laws or change them. Everything is solved in a law, and then it is the matter of its application, Skegro added. According to Economy Minister Porges, if the Government has the item of illiquidity of firms with blocked accounts over 360 days in arrears on its agenda, it appears that the Government takes over the obligation to settle such debts. "Problems will belong to the state, whereas successes will be privatised," he explained adding that his counterparts in the Netherlands and the Czech Republic, for instance, or somewhere else do not deal with problems of illiquidity among private firms. The responsibility lays with creditors, said Premier Zlatko Matesa. "The Government should not deal with the problem of two private subjects, but when an epidemic breaks out, it is a problem of the Government. And this is a case of an epidemic, Croatian Reconstruction, Development and Immigration Minister Jure Radic said adding that they should discuss where the error lies in the system, because everything is not up to the judiciary. By the end of May, out of 28,459 insolvent legal entities, 17,314 have had frozen accounts for over one year. Out of a total of 2.9 billion dollars of arrears, almost 70 percent refers to those companies. Three hundred blocked firms with biggest areas should find money for 1.2 billion U.S. dollars of unsettled orders. This has clogged the judiciary with a huge number of pending cases. After Justice Minister Zvonimir Separovic raised the question whether the Government was taking any measures to protect citizens from contaminated food products from Belgium, Agriculture Minister Ivan Djurkic informed that the Government had made several decisions on the restrictive approach to such produce. That's why there are no cases of food poisoning which may be caused by such food items, Djurkic added. Matesa said this was also an occasion for the promotion of Croatia's agriculture as "Croatia has not polluted its production." On Thursday, the Croatian Government considered amendments of members of parliament and adopted its own amendments to the proposed 1999 budget revision The Government was notified of the cooperation between Croatia and the World Bank and accepted conclusions on the completion of negotiations with the U.S firm Enron in respect to a thermoelectric power plant Jeretovac project. (hina) jn ms