Friday, 7 May 2021

Oleg Butković Presents Reforms And Investments For Transport Sector

ZAGREB, 7 May, 2021 - A part of the National Recovery and Resilience Plan (NPOO) refers to developing a competitive, energy sustainable and efficient transport system, and it is valued at HRK 5.5 billion, Minister of the Sea, Transport and Infrastructure Oleg Butković said on Friday.

The National Recovery and Resilience Plan totals HRK 47 billion and comprises five components, with the economy component valued at HRK 26.2 billion. That component includes a sub-component on developing a competitive, energy sustainable and efficient transport system, with investments worth HRK 5.5 billion, recalled Butković.

The plan, he said, foresees the continuation of significant investments in modernising transport infrastructure with the aim of developing a sustainable transport system and stimulating the development of smart solutions as well as  reforming rail, road and air transport as well as maritime and inland navigation.

We are prepared to make these reforms and that is an opportunity to continue the current strong investment cycle in transport infrastructure, which amounts to more than HRK 25 billion. With the resilience programme we are continuing that investment cycle which will amount to more than HRK 30 billion by 2030, particularly in railway projects as well as all the other projects, said Butković.

He announced that reforms would include amendment of the Roads Act by 2026 to create conditions for the interoperability of electronic road toll systems and improve road safety.

Answering reporters' questions, Butković said that the Hrvatske Autoceste road management company is well on its way to advertising a tender for a new contactless toll system at all motorways in the country.

He estimates that the tender could be advertised in September or October and that the new system will most likely mean the introduction of a digital vignette.

The plan also foresees the adoption of new laws on maritime zones and sea ports, on inland waterway transport and ports, and on regular and occasional sea transport to ensure uniform implementation of regulations on public port management.

The plan also includes the construction and reconstruction of railway infrastructure, the modernisation of sea ports, the procurement of three passenger ships and three catamarans, new ferry boats, trams, buses, a new photovoltaic power station, and the construction of a new Level 5 autonomous vehicle, said Butković.

According to Butković, HRK 2.8 billion of the HRK 5.5 billion planned to be invested in the transport system would be allocated to the private sector.

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Wednesday, 18 November 2020

EC to Review Possible Macroeconomic Imbalances in Croatia again

ZAGREB, Nov 18, 2020 - Croatia entered the COVID-19 crisis with vulnerabilities linked to the government, private sector, and external debt in a context of low potential growth, so the European Commission on Wednesday again recommended making an in-depth review to estimate macroeconomic imbalances.

In the Alert Mechanism Report, a screening device to detect potential macroeconomic imbalances, the Commission recommends that in-depth reviews to identify and assess the severity of possible macroeconomic imbalances should be prepared in 2021 for the same 12 member states that had already been identified as having imbalances or excessive imbalances in February 2020.

Croatia, France, Germany, Ireland, Netherlands, Portugal, Romania, Spain, and Sweden have imbalances, while Cyprus, Greece, and Italy have excessive imbalances.

"With the COVID-19 crisis, debt ratios and unemployment are expected to increase. Overall, the Commission finds it opportune, also taking into account the identification of an imbalance in February, to examine further the persistence of imbalances or their unwinding," the report says about Croatia.

For several years until 2019, Croatia had excessive macroeconomic imbalances. In February of that year, the Commission established that the imbalances were no longer excessive.

Croatia's considerably negative net international investment position "continued improving in 2019 and the current account surplus increased towards 3% of GDP. Risks to external sustainability are alleviated by the relatively large share of FDI (foreign direct investment) in total foreign liabilities. The current account balance is expected to turn negative in 2020, much on account of the weak tourism," the Commission says in the latest report.

"The private sector debt ratio continued declining in 2019. The large share of debt remains denominated in foreign currency generating exchange rate risk," the Commission says.

"Real house price growth accelerated in 2019 to above 8%, supported by the accelerating growth in mortgage lending... House price growth is forecast to decelerate in light of the COVID-19 crisis."

"Government debt continued declining to a still relatively high 73% of GDP in 2019. In 2020 it is forecast to rise by more than 15 pps. due to the sharp economic downturn and measures to support the economy in light of the COVID-19 pandemic," according to the report.

"The banking sector is characterized by moderate profitability and relatively strong capitalization, but also relatively high, though declining, NPLs (non-performing loans). NPLs are likely to increase once government support measures in response to the COVID-19 crisis have been phased out."

"The unemployment rate reached an all-time low of 6.6% in 2019, accompanied by strong decreases in both long-term and youth unemployment. However, unemployment is forecast to increase with the current crisis," the Commission says.

Thursday, 22 October 2020

Gov't to Provide HRK 7.5bn in Grants for Wages in Private Sector this Year

ZAGREB, October 22, 2020 - Prime Minister Andrej Plenkovic said on Thursday that government allocations for workers' wages in the private sector would reach HRK 7.5 billion kuna by the end of this year.

Since the outbreak of the COVID-19 pandemic, the government has allocated HRK 6.85  billion to help private-sector companies ensure wages for their workers.

The proof that the government measures have been successful is data from the Croatian Pension Insurance Agency (HZMO) showing that there are currently 3,200 more pension insurees than at the outbreak of the corona crisis in late February, the premier said.

"The measures have been meaningful and efficient," he said, adding that they have helped many companies to survive and retain workers.

The PM said that a revision of the 2020 budget would be drafted next week.

Friday, 4 September 2020

EconMin: As Much EU Funds as Possible Should be Channelled to Economy and Private Sector

ZAGREB, September 4, 2020 - Minister of Economy and Sustainable Development Tomislav Coric said on Friday that he would try to steer as much funds from the EU aid package of €22 billion intended for Croatia as possible to the economy and private sector.

Coric was addressing participants at the Croatian Money Market conference in Opatija.

He said that he had heard from representatives of the real sector in which direction they thought Croatia's recovery should be going.

"We all share a certain dose of optimism about what is to come. The question of distribution of European funds from the EU envelopes of the 2021-2027 operational programme and from the recovery and resilience programme, will be a key issue. The ministry and government intend to direct the majority of those funds towards the economy," Coric said.

He added that it is necessary to improve the domestic economy's competitiveness and productivity in a number of industries, digitise the economy and improve the trade balance by reducing the deficit and boosting GDP growth.

Asked by reporters how much of the €22 billion was available to the private sector, Coric said that that has not been defined yet because neither of the two envelopes had been fully defined at the European level.

"We will probably have to wait for a few months for the answer to that question. Recovery plans need to be officially submitted to the European Commission by April next year and the major part of the funds will be based on that," he said and added: "It is important that already now we allocate as much money as possible to the private sector. There is no alternative. We have to be as strong as possible so that we can return to the pre-crisis level," said Coric.

Responding to reporters' questions, Coric said that the public debt would not explode and that a brilliant job had been done with regard to settling solvency and the government's liabilities for 2020.


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