GOVT DISCUSSES PUBLIC COMPANIES BUSINESS

( Editorial: --> 8073 ) ZAGREB, July 16 (Hina) - The Croatian Government on Thursday adopted a report on annual commercial operations of public companies in 1997 and a report on paid salaries in those companies for the period between January and May this year. Last year public companies realised a net profit of US $87 million, primarily thanks to the profit of the Croatian oil industry (INA) and Croatian Post and Telecommunications (HPT). Business activities in all companies registered an increase whereas the productivity was increased only in INA and HPT. The new Justice Minister Milan Ramljak attended the Government session for the first time today. The reports were explained by the head of the Office for Economics and Restructuring of Public Companies, Dunja Vidosevic. During 1996, personnel costs in public companies were considerably increased due to an increase in the number of employees and net wages, Vidosevic said. The highest increase was registered in Croatian Radio-Television (HRT) (39 per cent), then in the HPT (26%) and the Official Gazette (Narodne Novine) 22%. The average gross wage in public companies amounted to US $685, which is 18% more than in 1996 and 26.2% more than the average wage in economy in 1997. The overall investments increased from US $530 million in 1996 to US $718 million in last year, of which 88% accounts for INA, HPT and HEP. Positive results are visible in the Croatian Railways as well, Vidosevic said. The financial status of public companies deteriorated as regards money deficit, collection of outstanding debts and payment of obligations. The Office believes that representation costs in almost all companies are too high and should be reduced and directed into investments. Since there still has be no audit of business activities in four Croatian companies, the Government has accepted a proposal by Economy Minister Nenad Porges for those companies (HEP, HPT, Croatian Forrests and HRT) to invite offers in two weeks and chose auditing firms. Summarising the discussion, Prime Minister Zlatko Matesa said that Croatian consumers would be paying more as long as there was no competition on the market. Companies have to get rid of their assets which do not serve the basic activity, Matesa said adding that the restructuring of public companies did not mean laying off workers but improving offer. (hina) jn rml 161945 MET jul 98