HDZ: GDP growth not based on healthy economic foundation

Member of the European Parliament Ivana Maletic of the Croatian Democratic Union (HDZ) warned on Friday that Croatia's GDP growth of 2.8% in the third quarter was not based on a healthy economic foundation but only on tourism and the processing industry.

"We want GDP growth to be based on job creation, on an increasingly strong production, stronger competitiveness and own production-based exports," Maletic said at a news conference in the HDZ offices in Zagreb.

She added that such growth could be attained only with a government implementing specific reforms and concrete measures of assistance to the industrial sector, entrepreneurs, exporters, farmers, etc.

Maletic said that figures from the national statistical office showed that of the ten production activities that contributed to GDP growth, eight were stagnating or experiencing a decline, with growth recorded only in tourism (trade, services, accommodation) and the processing industry.

She explained that the processing industry was growing because in Q3 2014 the Sisak Oil Refinery did not operate most of the time, which had now resulted in a slightly higher increase in that industry.

Even though the tourist season was excellent, agriculture is still declining and we still have to import food and other products for tourists and we could produce them on our own, said Maletic.

She went on to say that data on gross investments in fixed assets in Q3 showed that they were up 2.2% but that since 2008 they had dropped by as much as 30%. Their current growth is owing to Croatia's membership of the EU and to EU grants, she said.

She said that the GDP growth of 2.8% was also owing to deflation.

With the current GDP growth and considering deflation and other effects, the nominal growth of GDP will be around five billion kuna while outlays for interest on debts alone amount to HRK 12 billion, said Maletic.

Last update: Fri, 27/11/2015 - 19:14

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