Capital Leaving Croatia – Banks Send €1.5 Billion Offshore
- by croatiaweek
- in Business
Banks in Croatia have shipped out 11.7 billion kuna (1.5 billion euros) from the country in the first eight months of 2012. The considerable capital outflow has gone in two directions – close to a billion to service foreign debt, and more than half a billion has gone off shore to increase foreign activity.
In recent years, the debt of Croatian banks has increased annually by 7 to 8 billion kuna (1 billion euro), and now for the first time, banks are focusing on paying the debt back. With foreign activity, it is not just the classic giving out loans abroad, but also there has been growth in deposits.
“Industry is in decline, manufacturing is the lowest it has been in the last five years. Soon as there is no production, there is nobody taking credit and the money goes off shore.” warns experts, saying that if there is nowhere for the capital to go at home, then overseas is the only logical move.
