Croatian EU flags (Photo: Igor Kralj/PIXSELL) Croatian EU flags (Photo: Igor Kralj/PIXSELL)

All told the Multiannual Financial Framework and 'Next Generation EU' coronavirus recovery fund total 1.82 trillion Euros. The EU's proposed seven-year budget stands at 1.074 trillion Euros, while the recovery fund accounts for 750 billion Euros, which will be comprised of 390 billion Euros in grants and 360 billion Euros in loans.

Croatia will receive a total of slightly more than 22 billion Euros from the 7 year budget and recovery fund. Over the next seven years Croatia will pay roughly 660 million Euros into the EU budget per year, for a total of approximately 4.6 billion Euros.

Economic analysts agree that Croatia should be well pleased with this, noting that it will be vital in achieving economic recovery in the wake of the coronavirus and that it also represents a unique opportunity for implementing key reforms. Economic analyst Guste Santini: “It will be the decisive aid in resolving the problems caused by the coronavirus on the one hand, but all of the missed opportunities to date on the other hand. This is praiseworthy, and I think that Prime Minister Andrej Plenković achieved a good result in Brussels, because he opened up room for reforms. It is another issue altogether if we will remain committed to implementing reforms.”

Economic analyst Damir Novotny believes that the financial package Croatia has received will also serve as a form of pressure on the government to implement structural reforms in spite of resistance at home. He added that he believes that the fact that the EU is taking on debt as a bloc for the first time, that this will lead to increased integration, through the so-called fiscal federalization of the European Union.

The prime minister's chief economic advisor Zvonimir Savić agreed that there will be pressure from Brussels, noting that the EU will closely monitor how the funds are being used.

Meanwhile, the Croatian Employers Association says that Croatia should be more than happy with its allotment from the Multiannual Financial Framework and 'Next Generation EU' coronavirus recovery fund, and that the funds need to be put to good use through well-crafted projects.

Source: HRT