CROATIA, IMF AGREE ON MAIN POINTS OF NEW THREE-YEAR ARRANGEMENT

ZAGREB, March 11 (Hina) - Negotiations with the International Monetary Fund have been successful and agreement has been reached on nearly all issues, Croatian Deputy Prime Minister Borislav Skegro told reporters Monday. Final talks with IMF and World Bank representatives have been scheduled for late March and early April, Skegro announced. Unlike previous arrangements with the IMF, the new three-year arrangement no longer focuses on short-term stabilisation but on restructuring and economic development in conditions of stability, Skegro said. Out of the funds granted under the new arrangement, US$ 500 million will be directly incorporated into Croatia's foreign exchange reserves in view of repaying a US$ 1.2 billion debt to the London club (association of commercial banks). "This move will make it clear to other financial institutions that funds won't be spent on non-profitable projects," Skegro said. "We are standing by our basic economic goals, which include a 3-percent inflation and at least a five-percent economic growth," he said. "While abiding by these 'hard' goals, the new arrangement takes a softer approach when it comes to the role and instruments of the National Bank and the Ministry of Finance," Skegro added. (hina) mm as 111825 MET mar 96