Representatives of the Croatian Chamber of Economy send a clear message to the government.
President of the Croatian Chamber of Economy (HGK) Luka Burilović said that policymakers have to make faster and bolder decisions and that reforms have to be implemented more successfully. He added that “only joint action can guarantee prosperity, which is why it is important for all actors to join forces”, reports tportal.hr on April 20, 2016.
Burilović pointed out the worrying trend of the public debt growth, lack of investments, low employment and high unemployment. The estimates show, he said, that the GDP growth this year would be somewhere around two percent, but that was not enough. “We need the growth of 3 or 4 percent just to service the debt, while for the more significant economic progress and development we need higher rates of growth”, he explained.
Director of the HGK Sector for Financial Institutions, Business Information and Economic Analysis Zvonimir Savić said that the tendencies of basic macroeconomic indicators (industrial production, retail, exports…) in the first quarter of this year point to a further growth in GDP. However, the pace of GDP growth is not sufficient to eliminate the existing macroeconomic imbalances of the national economy in order to increase the credit rating of the country, he added. Savić reiterated that the public debt, which is the result of the budget deficit, amounted to 86 percent of GDP.
The best indicator of the state of Croatian economy is the labour market situation where, despite current positive trends that are the result of the beginning of the tourist season, the unemployment rate stands at 15.1 percent. Savić pointed out that Croatia was among the “worst” EU member states when it came to labour market situation.
In addition, the labour market still has one of the lowest shares of active population and employment in the EU, but also an extremely high unemployment rate among young people – over 40 percent. “All these elements point to the need to accelerate the change in the society in terms of reforms in all segments and at all levels in order to quickly solve the accumulated problems”, Savić concluded.
