CRO FINANCE MINISTER CONSIDERS ILLIQUIDITY TRIVIAL

OPATIJA, Nov 19 (Hina) - "The Global Financial Crisis, the Croatian Government's decision on relieving tax burdens adopted during the year, high transfers from the state budget by various funds, are the basis for limitations to economic policies in 1999 and the state budget", said Croatian Finance Minister Borislav Skegro, opening the sixth advisory conference of the Croatian Association of Economists on Thursday. Some 360 economists are partaking in the two-day advisory in Opatija (northern Croatia). Skegro spoke about the 1999 budget stressing that lower expenditure will be felt in defence, security, reconstruction, debt payments. Increases will be felt in science, education and culture. Skegro particularly focused on illiquidity. "I do not intend to solve the problem of illiquidity by shaking monetary policies. Professional economists consider illiquidity trivial while in the political sector, it is not possible to disclose its true causes", Skegro said. According to Skegro, a section of illiquidity resulting from the war and old unpaid debts have been dealt with by the Government. The current illiquidity is not a debt incurred by the Government but rather of relations among Croatian companies. President of the Croatian Association of Economists, Vladimir Veselica said that with the estimated growth rate of 3.5 per cent for next year, Croatia will not be able to exit the transition crisis, what is more, attain a growth rate equal to developed countries. Veselica believes that a growth rate of between 10 to 12 per cent, would double Croatia'a Gross Domestic Product only after seven years. Therefore, Croatia must urgently intensify its investments which should amount to three to five billion US dollars annually, Veselica said. (Hina) sp jn/lml