The fiscal deficit in this year's first four months amounted to 2.6 billion kuna, or 1.1 per cent of the estimated GDP for this year. The deficit is 2.8 billion kuna lower than in the first four months of last year, while its share in GDP was down 1.3 per cent.
These figures point to a successful continuation of fiscal adjustment, the Ministry said, confident that plans to have the deficit account for 3.3 per cent of this year will be realised.
The reduction of the fiscal deficit affected the reduction of the general government deficit (government, extra-budgetary funds, and local self government units).
In this year's first three months, the general government deficit amounted to 3.9 billion kuna, or 1.6 per cent of GDP, which is 2.6 billion kuna or 1.3 per cent less than at the same time in 2005.
The Finance Ministry said fiscal adjustment had also affected the reduction of the external debt.
In 2004 the government reduced its external debt by about 200 million euros, in 2005 by about EUR400 million, and in the first four months of 2006 by about EUR400 million, or about a billion euros in two and a half years.
Croatia's external debt amounted to about EUR26.3 billion at the end of March. External debt growth has not been halted but in the last two years it has been slowed down, the Ministry said, adding that after a 31.6 per cent growth in 2003, the external debt grew 15 per cent in 2004 and 12 per cent in 2005.
(EUR1 = 7.3 kuna)