Government: S&P’s Decision Is Encouraging Sign

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The government is delighted with S&P’s decision to change Croatia’s credit rating outlook from negative to stable.

Deputy Prime Minister and Minister of Economy, Business and Trade Martina Dalić said on Saturday that it was an extremely encouraging sign that the outlook for Croatia’s credit rating was upgraded. She expressed confidence that the government’s economic policies would result in ultimate upgrade of the credit rating itself, which should in time return to the investment levels, reports Večernji List on December 17, 2016.

Dalić said the decision “shows that the rating agency recognized positive economic trends and the reduction of debt and deficit that we have achieved, but also the political stability brought by this government”. “In technical terms, this means that the agency could in the near future upgrade the credit rating itself”, she added.

The government understands this decision as another incentive to continue with economic policies which it introduced, and these are “policies that will strengthen growth and at the same time maintain and strengthen the stability of public finances”. Therefore the government has already taken measures relating to lower taxes, and will adopt further measures aimed at improving investment environment, reducing regulatory fees and non-tax levies. “All this will further strengthen growth, and it will be done within the budget which will keep the deficit at the 2016 levels and enable further reduction of public debt”, she added.

“This is also a message to all stakeholders in society that the current economic trends represent a chance for the Croatian economy, but we must use this opportunity in a way that will maintain fiscal stability and we must not see it as an opportunity to increase government spending”, said Dalić. For this reason, the Government insists on maintaining relations with all societal groups within the boundaries of financial possibilities. “This includes trade unions, but also all other societal groups”, she added.

“The reduction of political uncertainty brought by this government also contributes to a more positive view of the Croatian economy, for those who are watching us from abroad.” In the context of political tensions, positive economic trends cannot achieve their full effect, she explained. “We have secured that important political basis and we will use economic policies of this government, including structural reforms, to further enhance economic growth and ensure its durability and stability, not forgetting that all this should happen within the framework of sustainable finances and debt reduction”, she concluded.


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