HDZ PRESENTS STRATEGY OF ECONOMIC DEVELOPMENT

ZAGREB, Dec 23 (Hina) - The Croatian Democratic Union (HDZ) on Thursday presented a document entitled 'The Strategy of Economic Development of the Republic of Croatia - A Programme by the New HDZ Government", which includes the strategic guidelines of the party's political and economic programme in the upcoming election. A party representative Vesna Skare Ozbolt said the first strategic goal of the Croatian state was its joining Euro-Atlantic integration processes, which is followed by a high degree of well- being of all citizens, civil society, the protection of peace and national security and the country's joining global and regional associations and organisations. According to Nikica Valentic, HDZ's candidate for premier designate, a number of experts were involved in drawing up the strategy and the programme indicated important guidelines of Croatia's economic development in the next several periods, as well as solutions to the country's economic and social problems. Croatia wants to become part of the developed world by accepting its standards and criteria, Valentic said, stressing the importance of continuing to preserve the political stability as a precondition of economic stability. According to Valentic, the upcoming elections are extremely important because they will determine which option will earn the electorate's support in the next four years of the peace-time period. It is estimated that the economic growth rate in the year 2000 will be three per cent, however, it may be even higher, Valentic said, adding the high rates of sustainable development were based on tax increases. Increasing employment and social security are of crucial importance, Valentic said, adding unemployment was a serious problem. If the HDZ does not solve it in the next four years, it does not deserve the voters' trust, he added. Public spending is too high and needs to be reduced without jeopardising the country's defence and the functioning of the state administration, Valentic said, adding the VAT rate depended directly on the level of public spending. Croatia is not an over- indebted country but we have no intention of seeking loans any more because that would jeopardise the implementation of the strategy of economic development, he said. Speaking about the monetary policy, Valentic said it was being conducted by the Croatian National Bank with measures stimulating saving and maintaining a low inflation rate and a stable exchange rate. Croatia is a central European and Mediterranean country which wants stable and good relations with all neighbouring countries. The HDZ programme contains guidelines for all ministries on how they should deal with problems. We believe we can maintain the political, economic and social stability, said Valentic. Answering a reporter's question, Valentic dismissed the possibility of a real decrease of salaries but also of their unrealistic growth. We have an economic growth rate which guarantees the current level of salaries to budget users, Valentic said, expressing doubt as regards the possibility of deterioration of the economic and social situation in the first three months next year. Commenting on the state's debt to pensioners, Valentic said he respected the Constitutional Court's decision but due to a lack of funds in the pension fund, it was impossible to pay 10-15 back- logged pensions in a short period. A member of the HDZ National Committee, Anton Kovacev, said the fiscal policy would be based on the achievements made so far, primarily on the stable kuna. Kovacev believes the current tax system should not be changed, however, it was necessary to lift the burden off the economy by reducing VAT and introducing tax exemption for re-invested profit. (hina) rml