Croatia’s Foreign Debt Drops Below 40 Billion Euro

Total Croatia News

Updated on:

ZAGREB, November 3, 2018 – At the end of July 2018, Croatia’s gross foreign debt was 39.4 billion euro, dropping by 2.2% or by 870 million euro in comparison to July 2017, and thus, it continued decreasing for 32 months in a row year-on-year, the Croatian Chamber of Commerce (HGK) has reported.

The stable and favourable circumstances on the domestic financial market, which is experiencing high liquidity and low interest rates are reasons why all sectors have no need for any larger foreign borrowing thus avoiding additional risks in connection with foreign financing, the HGK says in its analysis of the country’s trends.

Broken down by sectors, it was the central bank with the highest deleveraging this July. The Croatian National Bank (HNB) cut its debt by 14.9% year on year. Other monetary institutions followed with their debt decrease by 12.7%, thus having a 75-month-streak of deleveraging.

The gross foreign debt of other domestic sectors fell by 5.9%, going down by 31 months in a row.

General government gross foreign debt increased by 2.1% on the year, and its share in the overall gross foreign debt came to 35.1%. The share of other domestic sectors in this debt was 34.6%, and direct investments accounted for 16.7%, whereas the share of other monetary institutions stood at 9% and the HNB’s share at 4.6%.

The HGK analysis notes that a level of the country’s gross external debt was brought back to the levels in 2008, however with marked changes in the share of certain sectors in the total debt.

The HGK’s analysts expect the ratio of gross foreign debt to GDP to fall to 75% by the end of this year, in parallel to improvements of other indicators of borrowing, and all of that is likely to have a positive effect on Croatia’s credit rating.

If you want to read more about Croatian economy, click here.


Subscribe to our newsletter

the fields marked with * are required
Email: *
First name:
Last name:
Gender: Male Female
Please don't insert text in the box below!

Leave a Comment