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Croatia - Macro monitoring report (English)

In the first half of 2016 growth strengthened to 2.75 percent thanks to exports growth, accelerating private consumption, and a rebound of investment. The labor market continued to improve, with unemployment falling to 13 percent, the lowest level since summer 2008. Higher profits of foreign-owned companies and lower absorption of EU funds widened the current account deficit in Q1, while recovery of imports completely offset solid growth of exports. Despite continuing household and corporate deleveraging, there are mild signs of a bottoming-up in lending to corporate sector. Growth-supported fiscal consolidation brought the fiscal deficit down to 2 percent of GDP, which in turn brought public debt below 83 percent of GDP. New elections were set for September 11 as the political crisis ended with collapse of the government and dissolution of Parliament. Recognizing the downside risks to growth, rating agencies confirmed the current non-investment grade credit rating of BB with negative outlooks, as country plans refinancing of more than 13 percent of its external debt in 2017.

Details

  • Document Date

    2016/09/01

  • Document Type

    Brief

  • Report Number

    108741

  • Volume No

    1

  • Total Volume(s)

    1

  • Country

    Croatia,

  • Region

    Europe and Central Asia,

  • Disclosure Date

    2016/10/05

  • Disclosure Status

    Disclosed

  • Doc Name

    Croatia - Macro monitoring report

  • Keywords

    human development index ranking;nominal exchange rate;current account balance;current account deficit;dissolution of parliament;export of goods;government debt ratio;quality and efficiency;international investment position;domestic capital market;total public debt;total external debt;balance due;current account surplus;level of private;import of goods;national poverty line;foreign direct investment;Labor Market;consumer price;fiscal consolidation;poverty headcount;bond issue;political crisis;nonperforming loan;unemployment rate;merchandise import;domestic liquidity;early retirement;corporate tax;social contribution;sovereign bond;management strategy;risk premium;government bond;merchandise export;import growth;regulatory restriction;net inflows;multilateral debt;export good;average investment;consumer confidence;life expectancy;retirement age;financial volatility;expenditure support;temporary financing;fiscal adjustment;Property tax;fiscal position;general elections;government deficit;tax revenue;investment grade credit rating;increased demand;tourism sector;domestic demand;household consumption;investment growth;corporate lending;domestic debt;swiss franc;ruling party;negative effect;tourist services;trade balance;trade deficit;foreign liability;judicial system;tax treatment;foreign currency;borrowing cost;administrative burden;average debt;retail trade;gross wage;government consumption;real gdp;low-skilled worker;industrial production;deflationary pressures;trade pattern;primary income;export growth;private consumption;fiscal deficit;downside risk;rating agency;

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Citation

Croatia - Macro monitoring report (English). Macro monitoring report Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/315701475658807168/Croatia-Macro-monitoring-report