Minister: Money Managed by Pension Funds Has to Boost GDP Growth

Total Croatia News

ZAGREB, September 9, 2019 – Economy Minister Darko Horvat has underscored that liquid funds managed by compulsory pension funds (OMF) are supposed to primarily boost Croatia’s GDP growth, adding that that the government can immediately present some 30 projects for OMFs to invest in.

Horvat was addressing a business conference “Investment challenges for pension funds” organised by the Jutarnji List daily and the Alliance of Associations of Pension and Insurance Management Funds (UMFO) in Zagreb on Monday, and on that occasion, he wondered how projects should be prepared for funds to invest in them.

As an example, he mentioned the Rimac Automobili company which is “seeking 100 million euro.”

“The basic question is why not provide 100 million euro to Rimac from pension funds if we know that the yield, I am certain, will be greater than depositing those funds into the banking system,” Horvat wondered.

He called on pension funds for talks on cooperation, saying that the government today can present some 30 prepared investments that pension funds can choose to invest in.

Labour and Pension System Minister Josip Aladrović underlined that compulsory pension funds have more than 107 billion kuna at their disposal.

He added that OMFs have almost two million members.

In the context of an exceptionally low level of activity by members to select a compulsory pension fund, Aladrović warned of a low level of financial and pension literacy.

CEO of the Croatian Financial Service Supervisory Agency, Ante Žigman, said that currently OMFs can invest 30 billion kuna in shares, which he considers to be a huge potential.

He too commented on the example of Rimac Automobili and explained that a company has to be listed on a stock market anywhere in the world for OMFs to be able to invest in it.

Mario Staroselčić of the AZ pension fund explained that OMFs had invested more than 10 billion kuna in local companies and that the main precondition to invest in a company is that it is listed on a stock market which brings transparency and security.

More economic news can be found in the Business section.


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