- Category: Economy
- Published on Thursday, 14 May 2015 13:16
The European Commission will not be tightening monitoring of Croatia's macroeconomic imbalances - but gave Zagreb a list of six economic recommendations to work on.
The European Commission on Wednesday decided that strengthening monitoring of Croatia's economy, due to its macroeconomic imbalances, was not necessary.
The Commission tightened its macroeconomic monitoring of the country in February, citing "subdued growth, delayed restructuring of companies and a gloomy situation regarding employment", among other issues.
In accepting Croatia's recentl submitted national action plan to tackle these imbalances, the Commission stressed that “the level of ambitions” of the Croatian authorities “remains short of expectations in a number of areas”.
In that light, it issued six economic recommendations. Croatia has to “secure a permanent correction of excessive budget deficit by 2016” and introduce a tax on real estate, something that the government promised a year ago.
Zagreb must also work on reforming the public health system and pension funds, raising the penalties for people taking early retirement.
The welfare system will have to be reformed, while wages have to be “aligned according to productivity and macroeconomic conditions”.
The government will have to decrease “overlapping between levels of central and local government”, while the system of state agencies should be rationalized.
The government already stated it will cut the number of administrative units in the country, while, according to a decision last week, state agencies will be merged, cutting their number from 57 to 48.
In other recommendations, the government is advised to cut parafiscal charges; remove barriers on service providers; enhance the effectiveness of trade courts and the judiciary in general; strengthen the framework for pre-bankruptcy settlement and bankruptcy in order to restructure the debts of companies; and introducing a procedure for personal bankruptcy.
On the issue of refugees, the Commission says Croatia has to accept 1.73 per cent of those that are seeking international protection and already in the EU. Additionally, Croatia will have to accept 315 refugees or 1.58 per cent of 20,000 which are situated outside the EU.