CONDITIONS PROPITIOUS FOR FOREIGN INVESTMENT - PRKA

ZAGREB, Sept 9 (Hina) - "Croatia's external debt is such that we can sleep peacefully, and now it's up to banks to try and improve their business performance through individual borrowing, without burdening the state," Prime Minister Zlatko Matesa told a news conference in Zagreb on Monday. Finance Minister Bozo Prka said that the trend of reducing intrest rates would result in further investment development. He said that the reduction of interest rates was "the most successful part of the economic policy of this government." The interest rate on the money market dropped from 35 percent at the beginning of the year to the current 7-8 per cent. The discount rate of the National Bank of Croatia was reduced from 8.5 to 6.5 percent a year. Prka said that conditions had been created for Croatia to be classified on the international financial market as a country free of war risk, propitious for investment and capable of repaying its debts according to schedule. It was expected that Croatia, as far as its credit rating was concerned, would be put in the same category as Slovenia, Hungary, Poland and Slovakia, he added. In response to a question, Matesa reiterated that "there will be no government reshuffle as announced by the yellow press. Reshuffles are normal in democratic countries, and should there be any you would hear about them from me first." (hina) vm jn 091742 MET sep 96