Croatia has achieved significant progress not only in trade policy reform, as a member of the World Trade Organisation, but is also working on a set of internal market structural reforms, Harry Broadman, a World Bank economic adviser, said in Zagreb on Tuesday at the presentation of his study "From Disintegration to Reintegration: Eastern Europe and the Former Soviet Union in International Trade".
Broadman is optimistic that Croatia, if it continues to implement reforms, notably those of the internal market, and if it continues to limit public spending, could become the leader in Southeast Europe.
He said the World Bank endorsed the European Commission's proposal to replace the existing bilateral free trade agreements between countries in the region with one free trade zone agreement.
Broadman added the Bank was engaged in that initiative together with the European Union and that, together with the Croatian government and other countries in the region, it was helping to reorganise the bilateral free trade deals into a harmonised, single free trade zone.
Broadman said creating a single free trade zone which would eliminate obstacles to investment and trade would be an important step forward.
The aforementioned study was issued in Washington earlier this year and analysed trade development in 27 transition countries after the fall of communism.
The World Bank Zagreb office said the study showed that most countries in the region were included in the global economy, that exports tripled and imports went up 2.5 times in the past 10 years, and that trade was growing faster than in any other world region.
The study also showed that free trade was a strong generator of development and that some states had exploited trade better than others.
All countries in the region should continue to reform their trade policies by reducing tariffs and the destimulation of exports, by trying to join the WTO and reducing the number of regional trade deals, said Broadman.