LOWER HOUSE DEBATES BUDGET EXECUTION IN 1997

( Editorial: --> 2108 ) ZAGREB, June 18 (Hina) - The Croatian National Parliament's House of Representatives Thursday debated a report on budget execution for 1997. The total revenue of the Croatian budget in 1997 amounted to US$5.2 billion, while the total expenditure and lending were executed at US$5.3 billion, Deputy Finance Minister Mijo Jukic told the representatives. Last year's budget realised its development and social role and the fiscal disburdening of the economy, Jukic said. He said that in four years a contemporary and transparent fiscal system has been created, with the introduction of profit tax and income tax, and value added tax starting this year. In 1997 Croatia also regulated relations with international financial institutions. The Deputy Finance Minister was also satisfied with the macro- economic environment. In the last two years the budget deficit accounted for about one per cent of the gross national product (GNP), Jukic said, emphasising Croatia is a low-debt country. The total debt is about 43 per cent of the GNP, including a little more than US$2.2 billion of interior debt and about US$700 million of foreign debt. Profit per citizen is about US$5,800, Jukic said. Speaking about macro-economic indicators, he said the inflation rate has been kept below four per cent since the introduction of a stabilisation programme. The lack of budget revision in the last two years points out to economic stability and wise planning, Jukic said, and recalled a consecutive increase in industrial production, the financial restructuring of banks and cuts in interest rates. The government's savings account last year amounted to US$580 million which, Jukic said, shows that the government has managed to save more taxpayers' funds than planned. These funds have been invested into road-building, reconstruction and other capital expenditures. The budget deficit in 1997 amounted to US$178 million which is almost 60 per cent less than planned. The total budget deficit in the GNP last year was less than one per cent. With this deficit and a maintained macro-economic stability, Croatia ranks among the most successful countries in transition in 1997, the Deputy Finance Minister said. (hina) ha jn 181610 MET jun 98