According to Plenković, the goal is to achieve GDP growth of 5 percent by 2020.
HDZ president and probable future Prime Minister Andrej Plenković said on Friday that the goal of economic policy in 2017 would be to put Croatian economy on a sound footing, in order to achieve an economic growth of 5 percent and the employment rate of 68 percent by 2020, reports Večernji List on September 30, 2016.
The basic points of the economic policy plan for next year were presented by Plenković at a business conference. “Our goal is to put Croatian economy on sound footing, and our efforts will be focused on the implementation of measures that will lead to economic growth and development of Croatia, creating new jobs, while at the same time increasing social justice and starting the demographic renewal process, including stopping the emigration of young people. Current external factors are working in our favour and they have an impact on the economy, but we must be aware that it is necessary to have a meaningful economic policy, which will take advantage of such favourable conditions for economic growth”, said Plenković.
He pointed out that the goal was to achieve by 2020 an economic growth of 5 percent, create new jobs and achieve the employment rate of 68 percent, which would mean about 180,000 new jobs. Plenković added that the economic policy would have five main pillars.
The first pillar is a comprehensive reform of the tax system, with the aim of simplifying and reducing the tax burden for entrepreneurs and citizens, in order to ultimately regain the trust of investors. This includes the activation of unused state property and a restructuring of public enterprises. The second pillar is an investment in growth drivers, particularly agriculture, tourism and industry. Greater efficiency of institutions is the third pillar and it involves digitization, the introduction of e-government, and linking of public administration bodies. The fourth pillar is sustainability of public finances, while the fifth pillar is the reform of the education system.
“We will continue with the reduction of the budget deficit and the public debt to GDP ratio through a careful combination of fiscal consolidation and growth generation. The budget for next year will be based on this principle. In this context, we will continue our dialogue with the European Commission and continue preparing the national reform and convergence programmes. Their goal is to reduce the deficit, increase macroeconomic stability, strengthen competitiveness and create new jobs”, said Plenković.
He stressed that the budget is seen as a turning point. “Public finances should continue the positive direction from 2016 and permanently go further in a positive direction, due to which we should get out of the excessive deficit procedure and improve our credit rating. Therefore, in 2017 our focus will be on the expenditure side of the budget”, he stressed, adding that the aim was to reduce the general government deficit next year to 2 percent of GDP, which would contribute to the reduction of public debt to GDP ratio.
“Croatia now pays 12 billion kuna in interest on public debt. The raising of credit rating and reduction of interest on debt is one of the key priorities”, said Plenković, adding that the plan was to have a balanced budget by 2020.