Based on the national reform plans, the Commission has assessed that all countries announced sufficiently ambitious and clear measures on the basis of which we estimate that at this point there is no need to take stronger measures, Commissioner for Economic and Financial Affairs Pierre Moscovici said while presenting country-specific recommendations for all the member states, which the Commission released on Wednesday.
The Commission addressed six recommendations to Croatia for this year and the next, including those to reduce the excessive deficit, discourage early retirement, align the pay system with productivity and macroeconomic conditions, streamline state agencies and reduce parafiscal levies.
The Commission found in February that Croatia, Bulgaria, France, Italy and Portugal had excessive macroeconomic imbalances, saying that the MIP could be launched against Croatia and France if the measures the two countries had announced in their national reform programmes were found insufficiently ambitious.
The Commission grades the imbalances in six categories and Croatia is in the fifth, which covers countries with excessive imbalances that require specific monitoring and decisive policy action.
The first category includes countries with no imbalances; the second includes countries that require monitoring and policy action; the third includes countries with imbalances that require monitoring and decisive policy action; the fourth includes countries with imbalances that require specific monitoring and decisive policy action; the fifth category includes countries with excessive imbalances that require specific monitoring and decisive policy action; and the sixth category includes countries with excessive imbalances that require decisive policy action and activation of the MIP.
The first five categories are part of the preventive arm of the MIP. Croatia remains in the fifth category after the Commission studied its reform programme.