July the 5th, 2024 – The level of Croatian public debt reached 63.3 percent of the country’s GDP back at the end of March this year.
As Poslovni Dnevnik/Domagoj Puljizovic writes, back at the end of March this year, the level of Croatian public debt amounted to 49.5 billion euros. That’s a staggering 1.1 billion euros more than in the same period last year. Due to strong economic growth, the share of debt in the country’s GDP fell to 63.3 percent, current Croatian National Bank (CNB) data reveals.
According to the data of state finance statistics for the first quarter of 2024, the total state of the consolidated debt of the general government sector at the end of March stood at 49.5 billion euros. Compared to the end of December 2023, that means that there was an increase of 1.3 billion euros, or 2.6 percent.
Compared to the end of March last year, this debt is higher by 1.1 billion euros or 2.3 percent. Viewed in relation to annual gross domestic product (GDP), total Croatian public debt at the end of March was 63.3 percent of GDP.
Much like at the end of March last year, this ratio stood at 68.6 percent, which represents a decrease in the share of 5.3 percentage points on an annual basis. Compared to the end of the previous quarter, the ratio of debt to GDP increased by 0.2 percentage points.
The decrease in the ratio of debt to GDP of 5.3 percentage points on an annual level is a consequence of the strong growth of the domestic economy over the past year. According to data from the National Bureau of Statistics, in the first quarter of this year, Croatian GDP increased for the 13th quarter in a row, by 3.9 percent on an annual basis.
The CNB press release also states the structure of the general government debt by financial instruments. Long-term debt securities have the largest share (64.7 percent), followed by loans and deposits (29.4 percent) and short-term debt securities (5.9 percent).
Short-term debt securities increased by 1.4 billion euros or 89 percent compared to March of last year, thus achieving the largest relative increase in the total debt structure, from 3.2 to 5.9 percent.
It’s worth reminding ourselves that at the end of May, the Finance Ministry revised the macroeconomic forecasts for this year. In doing so, it increased Croatia’s expected GDP growth rate, as well as the deficit and the share of Croatian public debt in GDP. The rate of economic growth for 2024 was as such increased from 2.8 to 3.5 percent.
The deficit of the consolidated general government is therefore estimated at 2.6 percent of GDP, instead of the previous 1.9 percent. That’s all while Croatian public debt is expected to be below the Maastricht limit, at 59.2 percent of GDP. The inflation rate forecast has remained at 3.1 percent.
