Vecernji List: Public Debt Increases by HRK 30bn Due to Pandemic

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This year, about HRK 50 billion in old debt is coming to maturity, so Finance Minister Zdravko Marić has to refinance it, and in addition to that, the state will have to borrow another HRK 12 billion, the daily said.

Thus, this year’s budget deficit should be about 3% of GDP. Two larger bonds are coming to maturity, with the first foreign bond of $1.6 billion coming to maturity in March.

Preparations for refinancing that bond are already underway, and judging by the situation on the international money market, that debt should be, depending on the maturity, refinanced below one percent since the financing conditions are still extremely favourable.

Total public debt is expected to fall slightly toward 84% of GDP, after a marked increase from 73% to 86% of GDP in 2020 .

The public debt was increased by HRK 30 billion of the new budget deficit, which was caused by the coronavirus pandemic.

At the same time, the current surplus, which the banks hold in the Croatian National Bank (HNB), amounts to about HRK 60 billion, Večernji List said, carrying the statement of HNB’s chief economist Vedran Šošić, who said that financing conditions were still very favourable and that the state’s needs could be met very favourably.


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