Economic analysts predict a rise in public debt throughout 2020 due to the corona crisis despite being 6.5% lower in January compared to January 2019.
Croatia's gross foreign debt of 41.1 billion kuna at the end of January 2020 contracted by 2.8 billion euros or by 6.5% on the year, according to the figures recently published by the Croatian National Bank (HNB).
However, considering the new circumstances in connection with the coronavirus pandemic that decimated the global economy, analysts expect the deterioration in Croatia's external vulnerability.
Analysts at Raiffeisenbank Austria (RBA) said that positive trends that began back in 2013 would likely be snapped, resulting in a rise in the country's gross foreign debt both in the real and nominal terms.
"Recovery and relaunching economic activity, which will require large amounts of funding, will lead to a rise foreign loans by all key sectors," said analysts.
As a result of growing debt and the expected sharp economic downturn, Croatia's gross foreign debt to GDP ratio is likely to increase, too.
At the end of 2019, Croatia's gross foreign debt to GDP ratio was 75.7%.
- Croatia reports record number of new Covid-19 infections
- Croatia makes face masks mandatory in stores
- Beroš: Croatia still among EU leaders in containing COVID-19
- Croatia hits new record in coronavirus cases
- 53 new coronavirus cases in Croatia
- Croatia expected to get invite for Eurozone waiting room on Friday