PREMIER SAYS CROATIA'S FUTURE LIES IN TOURISM

( Editorial: --> 7296 ) KORCULA, May 28 (Hina) - The Croatian Government sees the country's future in the tourism and service sectors. Despite the difficulties caused by war and transition, about US$1 billion dollars has been directly invested into tourism, Premier Zlatko Matesa said in Korcula on Thursday. He was speaking at a press conference on the southern Adriatic island near where a journalists' yachting regatta Dalmatia Cup 1998 is being held. Croatia will do everything possible to reshape its tourist product. To that effect it will raise the quality and selection of services and development of nature friendly tourism. That was the reason for closing a coke plant at Bakar Bay (northern Adriatic) and some smoke stack industries in the area of Sibenik (central Adriatic). Croatia and the World Bank will also undertake large ecological projects along the Adriatic coast. This year we expect 15 per cent more tourists than last year, when we had 15 million guests. The whole of Croatia must beat in the rhythm of tourism, Matesa added. "Last year there was not a single incident during the entire season. We guarantee the safety of all guests, wherever they come from," Matesa said. Matesa also stated that industrial output had been rising for 31 months in a row, longer than ever before in Croatia's history. Croatia's inflation rate is one of the lowest in Europe. The projected rate for this year is 3.5 per cent. Thanks to the introduction of Value Added Tax on 1 January, this year the state budget will be balanced and there will be no need of borrowing. When asked by a BH journalist what was Croatia planning to do with the property of BH citizens in Croatia, Matesa answered that Croatia and BH had not signed a property agreement, but that Croatia was nevertheless committed to general respect of property rights. After the success of this year's Dalmatia Cup, the Government is considering turning it into an informal world championship of yatchsmen-reporters. (hina) jn mro/bag 281908 MET may 98