Croatia’s public debt has climbed to 221.8 billion kuna (29 billion euros) in the first quarter of 2014, up 1.6 billion kuna (209 million euros) from the previous quarter, leaving its Finance Minister rightly concerned…
Speaking on Wednesday, Minister Boris Lalovac said that when public debt exceeded Gross Domestic Product by more than 60% then it spelt tought times. Croatia’s public debt is now 68% of GDP .
Finance Minister Boris Lalovac said on Wednesday he was worried about Croatia’s public debt because its increase envisaged much tougher reforms, voicing hope that motorways would be monetised by the end of the year so that the debt could be reduced. When quizzed about the state of Croatia’s motorways, Lalovac said that leasing them out could happen shortly to help relieve debt.
“The goal is to use the monetisation only for reducing the public debt. The budget deficit won’t be such a problem in the future, but the public debt certainly will,” Lalovac said, adding that monetisation could bring in around 3 bllion euros.
There could be more bad news however for Lalovac and Croatia as analysts warn that public debt looks set to increase and exceed 80% of GDP.