CROATIAN OIL COMPANY DECREASES PRICES

( Editorial: --> 3399 ) ZAGREB, Jan 9 (Hina) - The Croatian oil company Ina announced to decrease prices of petroleum products due to the newly applied Value Added Tax (VAT). As of 16 January prices of petroleum derivatives will be 4.5 per cent lower in average. Ina's general director Davor Stern told a news conference on Friday that the decrease in prices was exclusivelly the result of the VAT. Pointing out the importance of the prices of energy products for other economic subjects, Economy Minister Nenad Porges said he expected that "economic subjects, who will have these prices as of 16 January, will correctly and adequately re-design their prices". The retail price of engine petrol INA Super MB-98 will be 2.3 per cent lower and one litre will be US$ 0.61. The price of Normal BMB-91 will cost US$ 0.58 (1.3 per cent lower) and one litre of Eurosuper BMB-95 petrol will cost US$ 0.61 (3.3 per cent lower than currently). Stern expressed hope that the decrease of prices of petroleum products would reflect on the stabilisation of prices of other items. The prices of petroleum products were decreased by a total of 14.2 per cent since November 1996, and are returning to the level of prices in 1994. Advocating market economy and free price formation, Porges stressed that nobody had the right to distort the truth. We need to identify how much an increase in prices is the result of VAT, and how much is the result of margins or profit, Porges said. (hina) lm jn 091955 MET jan 98