Friday, 4 September 2020

FinMin: Full Economic Recovery Expected in 2022

ZAGREB, September 4, 2020 -This year's economic decline will not be as sharp as originally estimated, a full recovery is expected by 2022, and our goal it to leave the crisis behind as soon as possible, Finance Minister Zdravko Maric said on Friday in Opatija, where he attended the Croatian Money Market conference.

The government had earlier projected that GDP would drop by 9.4% in 2020, and when asked by reporters whether the drop would be lower than 9% according to the new projection, Maric said that the drop on the year would still be marked but lower than originally projected.

He said that they would report on it in a government session in two weeks and that the projection would be the basis for planning some measures and next year's budget.

Maric underscored that despite the depth of the crisis, Croatia had been much more prepared for it than it had been in 2008, in terms of macroeconomics. He noted that we need to leave the crisis behind us as soon as possible as last time it took us 11 years to recover and only in 2019 did we manage to reach the level of GDP from 2008.

He said that the response to the coronavirus-caused crisis had been timely and adequate, underscoring that the focus was on job retention.

Minister Maric also said that the Next Generation EU recovery instrument could be a great opportunity for Croatia in this challenging situation as it can be used not only for economic recovery but also for resilience.

Asked when those EU funds would be available, Maric said that implementation would fully commence in the second half of 2021 but that part of the funding would be available to Croatia in the form of advance payments before that.

"Next year, Croatia will receive an advance payment of at least 10%, or about HRK 3 billion, and that can be used for these measures and will be part of the budget," he said.

Maric mentioned the Solidarity Fund in connection to Zagreb's post-earthquake reconstruction as an example of an advance payment.

"We are speaking of €500 million, possibly even up to €700 million. A few days ago we received the biggest payment yet from the Solidarity Fund, of €89 million," he said.

Commenting on yesterday's meeting with US Ambassador to Croatia Robert Kohorst, who presented the government with a draft agreements on double taxation avoidance, Maric recalled that the basic aim of these agreements was to protect citizens and entrepreneurs from double payments of tax.

As for the coronavirus crisis, Maric said that everything was under control.

"We are rational, we are implementing measures, we are endeavouring to react in time and adequately. There are a lot of challenges, some activities are still affected and measures have continued for some sectors. We all need a healthy and positive climate, without irrational and unrealistic promises and we all need to act together," he said.


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Wednesday, 2 September 2020

FinMin: Keeping Jobs Is A Priority

ZAGREB, Sept 2, 2020 - Deputy Prime Minister and Finance Minister Zdravko Maric said on Wednesday after an inner cabinet meeting that keeping jobs is a priority and that support measures for sectors affected by the coronavirus crisis, such as hospitality and transport, will be made known in the next few days.

Maric made the statement while responding to reporters' questions about the continuation of measures for the hospitality sector, which Tourism and Sports Minister Nikolina Brnjac had announced earlier, saying that they were on the table and being taken care of.

He said that internal consultations were ongoing and recalled that the government had generously financed support for the economy, however, he noted that everything has its fiscal repercussions and fiscal possibilities.

"This year the budget result is not a priority, however, in these circumstances it is necessary to find funds and ensure budget sustainability for this year and the years to come," said Maric.

Keeping jobs is a priority, he said, recalling that the government had presented a shorter working week and that the recently approved SURE program would provide a little more than €1 million in loans for Croatia.

Intensive talks are underway regarding the generous envelope that is part of Europe's recovery plan, Maric said, adding that testing was already underway regarding the use of support in hospitality.

Maric added that he understands the problems faced by the occasional transport sector whose representatives earlier in the day handed out leaflets to lawmakers listing their problems.

We have embarked on horizontal measures and have continued to support tourism and transport and everything will be made known in the next few days, he said. 

Our priority is to keep jobs and we are willing and ready to do the best we can, he added.

Maric explained that there had not been any money in the budget for the first round of support either, however, the money was eventually found and efforts would be made to continue to preserve jobs.

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Wednesday, 26 August 2020

FinMin: Q2 GDP Drop Expected To Be Larger Than During Financial Crisis

ZAGREB, Aug 26, 2020 - Finance Minister Zdravko Maric said on Wednesday the GDP drop in this year's second quarter was expected to be larger than the largest drop during the global financial crisis.

The national statistical office is expected to issue a report on GDP in Q2 on Friday.

Responding to questions from the press, Maric said the government would present new forecasts for the whole year in the first two weeks of September.

The largest GDP drop to date, of 8.8%, was recorded in Q1 2009, at the start of the global financial crisis.

Six analysts polled by Hina expect GDP to drop 13.9% year on year. This will be the first drop since mid-2014 and the largest since 2000.

Maric said everyone realized how much the state-supported the economy this year via job retention measures, but added that this could not be done indefinitely.

New programs are opening up, such as the EU's SURE program, from which Croatia is expected to receive €1 billion in favorable loans which will most likely be used to finance a shorter working week.

Maric said Croatia fared even better with the Next Generation EU instrument, the coronavirus recovery plan in which Croatia will have €9.4 billion at its disposal. He said the big challenge now was to draw the highest amount possible as quickly and as effectively as possible.

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