ZAGREB, Sept 26 – Croatia’s economy may grow roughly 3 percent next year, about the same amount as this year, the central bank governor Boris Vujcic said on Wednesday.
Many analysts and the central bank have said the slow pace of economic reform in Croatia, needed to improve the business climate by cutting red tape or reducing taxes, is hampering growth prospects in the longer run.
“Next year we see a growth of slightly below 3 percent, similar to this year,” Vujcic told an economic conference on corporate business plans in 2019.
He said the central bank expected the main growth drivers to be exports, consumer spending and investment.
“This year, the level of investment has been below our expectations, but consumer spending has somewhat surpassed our expectations,” Vujcic said.
He also said the risks for the forecast for next year were largely on the downside.
“We are witnessing a slowdown in industrial production in Croatia at the moment. In the event of slower industrial production and growth in our main trading partners, Italy and Germany, it would negatively affect our growth. Also, rising trade barriers on the international level could have a negative impact,” Vujcic said.
Vujcic said average inflation next year was seen at 1.6 percent, a touch below 1.7 percent expected this year. (Reporting by Igor Ilic; Editing by Hugh Lawson)