Stiglitz, who is one of the most respected economists in the world, winning the Nobel Memorial Prize in Economic Sciences and the John Bates Clark Medal, is in Split and Hvar this week for the 11th International Conference “Challenges of Europe: Growth, Competitiveness and Inequality”.
The former senior vice president and chief economist of the World Bank says that for Croatia to get out of its 6-year stagnation Europe must first grow.
“Croatia is in a difficult position. The first policy (to kickstart growth) would be to get the rest of Europe to grow. Because if the rest of Europe grows they come down to Croatia for beautiful vacations, they buy more Croatian goods and that would do more than anything else to lift up the Croatian economy”, Stiglitz told Croatian television, adding that Croatia, as a very small country, are not going to persuade Europe easily to address their flawed policies.
Stiglitz, who is known for his critical view of the management of globalization, free-market economists, and some international institutions like the International Monetary Fund and the World Bank, says Croatia needs to address its debt problem.
“The next thing to address is the debt problem. You are going to have to think very carefully about converting those debts that are denominated in Swiss francs and Euros into the local currency, ” he said, before adding that it has to be the banks who will have to pay the price.
“The banks should pay the price of this conversion for two reasons – they made loans that were inappropriate and they were supposedly the financial experts, they were supposed to be advising ordinary Croatians and they didn’t do their job,” he said.
Stiglitz stressed that coming up with a set of policies to get the country growing would be the best thing to do to lower Croatia’s economic risks.
The conference closes on Friday.
(photo / screenshot)