The Finance Ministry is aware of the potential negative effects of Agrokor, but is looking into ways to solve the situation and take into account negative effects on the budget, while at the same time protecting public finances, the Finance Minister, Zdravko Maric, said on Friday, speaking at a conference on the Croatian finance market.

The risks are much more pronounced elsewhere, such as in the state-owned Petrokemija and Uljanik companies, the minister said.

Both Petrokemija, a Kutina-based fertiliser manufacturer, and Uljanik, a shipbuilding company in Pula, are currently looking for investments after years of posting crippling losses.

Maric said that the ministry continued to control the expenditure side of the budget and use the budget surplus to further reduce public debt, as well as finance a new round of tax cuts.

“The budget is within our expectations, there are no big surprises, and the tax revenues, after two rounds of cuts, have resulted in positive surprises,” Maric said.

“In the next round (of tax cuts) we will again aim to look at the entire system, there will not be so many changes, but in any case, it is good that we should talk about this topic again, and focus, for the third year in na row, on cuts, and not increases,” he said.

The measures should be created by summer, Maric said, and their implementation is expected to begin on January 1, 2019.

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