ZAGREB, October 1, 2019 – The Croatian National Bank (HNB) on Monday presented a revision of statistics on relations with foreign countries, which reveals an increase in gross foreign debt in the period from 2000 to 2018, most of which happened at the end of 2018, in the amount of close to €3.9 billion, and a decrease in the current account balance of payments in all the years since 2002, ranging from €21 million to 974 million.
In line with the revision practice of euro area member-states, in 2019 a major revision of statistics of relations with foreign countries was undertaken, which primarily refers to data on the balance of payments, the state of international investments, as well as data on foreign debt, HNB vice-governor Roman Šubić said.
Major statistical revisions are done every five years, and the most important improvements refer to data on tourism revenues and their impact on the balance of payments, to the inclusion of informal worker remittances, imports of vehicles from the EU by natural persons, as well as trade credits with the maturity period of up to six months, i.e. deferred payment.
In line with the new methodology, historical data were revised as well, in some segments back to the year 2000, HNB officials said.
The revision of data on gross foreign debt reveals an increase in debt in all the years since 2000, in the range of about €1.3 billion to 3.9 billion.
That growth was mostly due to the inclusion into foreign debt of trade credits, i.e. credits which companies or suppliers grant to Croatian buyers borrowing abroad, for the purchase of their goods and services, with a maturity period of six months.
An HNB analysis shows that the situation in the period from 2016 to 2018 was undervalued by 17-21% on the expenditure side, that is, when a buyer from the country buys a product or a service abroad with a maturity period of six months.
The central bank’s revised data show that gross foreign debt at the end of 2018 totalled €42.7 billion, €3.9 billion more than according to the old methodology (€38.8 billion).
Data for 2019 show a further increase in foreign debt, which at the end of the second quarter amounted to €44.6 billion.
The revision found that the amount of tourism revenues in the balance of payments was overestimated, primarily due to the estimated number of foreign tourists visiting Croatia. The new calculation of tourism revenues uses methods based on a combination of physical indicators and indicators of average spending by foreign tourists.
The revision of data from 2003 revealed a decrease in revenues from foreign tourists by between €500 million and 1.1 billion, which has had a negative impact on the current account balance. The new data for 2018 show that revenues from foreign tourists were €600 million lower, reaching €9.5 billion, while according to previous, unrevised data they amounted to €10.1 billion.
Šubić says that there has been a change to the data collection methodology, adding that data from the State Bureau of Statistics were used before, while now far more detailed data from the Ministry of the Interior are used.
“These data track the number of foreign tourist arrivals. The possibility of monitoring the number of vehicles entering the country makes is possible to estimate the number of passengers per vehicle and ensure better statistics,” he said.
Explaining the method now used to calculate tourism revenues, he said that the estimated number of foreign visitors is multiplied by their average spending.
Also included in the balance of payments are informal worker remittances because it was noticed that Croatian workers returning home from abroad used informal channels for money transfers. As a result of their inclusion, the current account balance increased by between €174 million and 326 million.
The revision also covered changes in used car imports from the EU by natural persons. Previously, official statistics covered only car imports conducted by legal entities, which had a negative impact on the current account balance ranging from €41 million in 2013 to €317 million in 2018.
Šubić said that it was in everyone’s interest to have as accurate and comprehensive statistics as possible that could be comparable on an international level.
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