ZAGREB, June 14 (Hina) - "The kuna will continue to appreciate and I recommend to Croatian citizens to keep their savings in kuna," Economy Minister Goranko Fizulic said in Zagreb on Wednesday, calling devaluation requests 'nonsense'.
"In the next 18 months the Croatian National Bank will have a problem with high foreign currency amounts, and those who are now seeking devaluation of the kuna are illiterate," Fizulic said at a meeting of the Croatian Employers' Association (HUP), dedicated to the strategy of economic development. The Economy Minister described as incompetent articles whose authors presented numerous complaints and possible consequences which could be detrimental to Croatia once it was admitted to the World Trade Organisation. "Croatia will either export or die," he added. With a mere 4.2 billion dollars of annual exports Croatia stands no chance of being a trade partner to an
ZAGREB, June 14 (Hina) - "The kuna will continue to appreciate and I
recommend to Croatian citizens to keep their savings in kuna,"
Economy Minister Goranko Fizulic said in Zagreb on Wednesday,
calling devaluation requests 'nonsense'.
"In the next 18 months the Croatian National Bank will have a
problem with high foreign currency amounts, and those who are now
seeking devaluation of the kuna are illiterate," Fizulic said at a
meeting of the Croatian Employers' Association (HUP), dedicated to
the strategy of economic development.
The Economy Minister described as incompetent articles whose
authors presented numerous complaints and possible consequences
which could be detrimental to Croatia once it was admitted to the
World Trade Organisation.
"Croatia will either export or die," he added.
With a mere 4.2 billion dollars of annual exports Croatia stands no
chance of being a trade partner to anyone. Countries of the similar
size - Finland, Ireland, Israel and Portugal - have ten times higher
exports than Croatia. Lohn activities account for a large portion
of Croatia's current exports, the export of machines and equipment
accounts for 35 percent, while food accounts for less than 10
percent of all exports. Fizulic therefore believes that the
Croatian Bank for Reconstruction and Development should, along
with strengthening exports, also take over the role of the stronger
Croatian Exim Bank.
A question that arises here is whether this government is able to
lower labour costs, because as long as contributions on net wages in
Ireland amount to 40 percent and in Croatia to 95 percent, there can
be no competition, Fizulic said.
The recent reduction of contributions on salaries amounting to 3.5
percent will continue, big investors must be exempt from profit
taxes, and a zero VAT rate and a cheap state must be introduced.
Also required are organised land registers and cadastral books as
well as a regulated and efficient judiciary if debtor-creditor
problems are to be solved and if investors are to be encouraged to
invest capital in Croatia and not somewhere else, Fizulic said.
The government therefore expects business people and the HUP to
support those changes, which will be opposed, he added.
HUP representatives announced that their views regarding the
government measures, solutions and requests would soon be
forwarded to competent bodies.
Business people held meetings on the development strategy also in
Osijek, Rijeka and Split.
(hina) jn rml