FinMin: Full Economic Recovery Expected in 2022

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Full economic recovery expected in 2022
Full economic recovery expected in 2022

ZAGREB, September 4, 2020 -This year’s economic decline will not be as sharp as originally estimated, a full recovery is expected by 2022, and our goal it to leave the crisis behind as soon as possible, Finance Minister Zdravko Maric said on Friday in Opatija, where he attended the Croatian Money Market conference.

The government had earlier projected that GDP would drop by 9.4% in 2020, and when asked by reporters whether the drop would be lower than 9% according to the new projection, Maric said that the drop on the year would still be marked but lower than originally projected.

He said that they would report on it in a government session in two weeks and that the projection would be the basis for planning some measures and next year’s budget.

Maric underscored that despite the depth of the crisis, Croatia had been much more prepared for it than it had been in 2008, in terms of macroeconomics. He noted that we need to leave the crisis behind us as soon as possible as last time it took us 11 years to recover and only in 2019 did we manage to reach the level of GDP from 2008.

He said that the response to the coronavirus-caused crisis had been timely and adequate, underscoring that the focus was on job retention.

Minister Maric also said that the Next Generation EU recovery instrument could be a great opportunity for Croatia in this challenging situation as it can be used not only for economic recovery but also for resilience.

Asked when those EU funds would be available, Maric said that implementation would fully commence in the second half of 2021 but that part of the funding would be available to Croatia in the form of advance payments before that.

“Next year, Croatia will receive an advance payment of at least 10%, or about HRK 3 billion, and that can be used for these measures and will be part of the budget,” he said.

Maric mentioned the Solidarity Fund in connection to Zagreb’s post-earthquake reconstruction as an example of an advance payment.

“We are speaking of €500 million, possibly even up to €700 million. A few days ago we received the biggest payment yet from the Solidarity Fund, of €89 million,” he said.

Commenting on yesterday’s meeting with US Ambassador to Croatia Robert Kohorst, who presented the government with a draft agreements on double taxation avoidance, Maric recalled that the basic aim of these agreements was to protect citizens and entrepreneurs from double payments of tax.

As for the coronavirus crisis, Maric said that everything was under control.

“We are rational, we are implementing measures, we are endeavouring to react in time and adequately. There are a lot of challenges, some activities are still affected and measures have continued for some sectors. We all need a healthy and positive climate, without irrational and unrealistic promises and we all need to act together,” he said.


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