Croatia’s Budget Deficit Falls Below 1%

Total Croatia News

Croatia had a deficit of 0.9 percent of GDP last year.

The deficit of Croatia’s state budget in 2016 amounted to 3.15 billion kunas, which was a record low of 0.9 percent of GDP, while public debt fell to 82.9 percent of GDP, the Central Bureau of Statistics and Eurostat announced on Monday, reports N1 on October 23, 2017.

Consolidated debt at the end of last year was 289 billion kunas or 82.9 percent of gross domestic product (GDP), while in 2015 it amounted to 289.5 billion kunas or 85.4 percent of GDP.

Consolidated general government deficit amounted to 3.155 billion kunas or 0.9 percent of GDP last year, while in 2015 it stood at 11.2 billion kunas or 3.3 percent of GDP.

The primary reason for such a low deficit in 2016 was a significant drop in the budget balance deficit, which was planned to reach 7.485 billion kunas but amounted to just 3.399 billion kunas, which was a result of favourable economic trends.

“An increase in tax revenues had the largest impact on the improvement of the deficit in 2016 compared to the previous years,” the Central Bureaus of Statistics pointed out. Namely, in 2016, taxes on production and imports brought as much as 67.8 billion kunas, which was an increase of 4.8 percent compared to 2015. Also, taxes on income, wealth and the like were collected in the amount of 22.9 billion kunas, which was an increase of 10.4 percent.

The second estimate, which was released on Monday, compared with the initial estimate published in April, significantly lowered the share of public debt in GDP, from the initial 84.2 percent to 82.9 percent. The share of debt in GDP estimate declined for the last several years, and the main reason was the revision of GDP, according to the report.

Compared to April’s announcement, general government debt in 2015 and 2016 was minimally revised due to the broadening the scope of the general government sector, according to the Central Bureau of Statics.

The reduction of general government debt in 2016 by 506 million kunas was primarily driven by sharp decline in short-term debt securities and central government loans. Also, the fall in general government debt by 2015 has also been contributed by the reduction of debt owned by local government authorities, according to the report.

Translated from N1.


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