Deputy Prime Minister and Finance Minister Zdravko Marić (Screenshot: HRT) Deputy Prime Minister and Finance Minister Zdravko Marić (Screenshot: HRT)

Government’s forecasts also indicate that Croatia will only reach, or possibly surpass last year's GDP in 2023. Deputy Prime Minister and Finance Minister Zdravko Marić commented on the issue for Croatian Radio today.

“The growth will be around 5%, which is somewhat less than we initially projected. In the mid-term that rate of growth will be at a little more than 3%,” Minister Marić said. He added however, that the growth will depend on the situation with the coronavirus: “However, there are positive aspects ahead as well, which primarily refers to the Next Generation EU recovery fund, depending on how successful and efficient we will be in drafting projects and reforms for drawing on those funds.”

For his part economic analyst Mladen Vedriš said that in order to speed up recovery, it will be necessary to improve Croatia's tax policy, primarily to further reducing the tax burden, adding: “Obviously in Croatia this discussion is always focused on the role of credit-monetary policy, but perhaps the core issue is in industrial policy, meaning what will we do to stimulate investment that will lead to production, exports and new technologies. Because tourism is an external variable, it does not rely on us alone, it is dependent on the health situation and transport, meaning will airlines be allowed to fly or not.”

Vedriš added that Croatia must also resolve problems that existed even before the corona-crisis, a position echoed by fellow economist Ljubo Jurčić: “In effect we need to run parallel policies, one to stop the base downward trend here, and the other to deal with the consequences of the corona-crisis.”

One of the primary sectors experts are pointing to in terms of boosting the economy is industrial production, and stimulating new areas of production.

“The first step is to make use of the natural resources God has given us. So, if we have agricultural land, mines, and lumber, then that's what we have to make use of. The second step is to make use of pre-existing infrastructural capacities, ones that you built up in the previous time period, and are still useful and can be put to use,” Jurčić concluded.

Source: HRT