GOVERNMENT WILL NOT ALLOW PRICE HIKES - ECONOMY MINISTER

ZAGREB, June 14 (Hina) - The recently adopted Customs Tariff Act has caused several unwanted side effects because some companies, believing that they are protected, have begun to raise the prices of their products or have announced to do so, Croatian Economy Minister Davor Stern told a press conference in Zagreb on Friday. "The government will show no mercy and will respond to all such attempts by quickly lowering customs duties," Stern said, adding that this message also applied to brick factories and wheat producers. He stressed that bread prices would not rise. Recent research into extra spending in the tourist trade has shown why Croatia is expensive to tourists. Margins on coffee, juice or beer range between 100 and 300 per cent and if prices of these products are not reduced, the government is thinking of limiting the margins, Stern said. There is a growing interest of foreign investors in Croatia, even in those areas where it was not expected, such as Sisak Ironworks and Dalmacija Cement factory in Dugi Rat, in which three foreign companies, two from Switzerland and one from South Africa, are interested, he said. The Croatian Agency for Investment Promotion (HAPU) was presented by its acting director Vanja Kalogjera. The agency will help foreign investors identify and select areas of potential investment, finalize investment projects or establish companies. (hina) vm jn 141714 MET jun 96