At the end of March 2018, Croatia's public debt totalled 281.3 billion kuna (€38.1 billion), according to the latest central bank figures, or 76.2 percent of the country's GDP, with analysts of the Raiffeisenbank Austria (RBA) forecasting that the ratio is expected to continue dropping.

The 281.3 billion kuna debt at the end of the first quarter of 2018, which is 0.9 percent or 936 million kuna (€126.8 million) up from February. The increase is attributed to the central government’s increased foreign debt on account of long-term bond issues.

Year-on-year, the public debt was 11.4 billion (€1.5 billion) lower compared to March 2017.

The foreign debt is down by 4.7 billion kuna or 4.1 percent year-on-year, while the internal debt dropped by 6.6 billion kuna or 3.7 percent.

Compared with the end of 2017, the general government debt was down by 2 billion kuna or 0.7 percent at the end of March 2018. Over the entire period, the public debt-to-GDP ratio decreased by 1.2 percentage points.

“Considering that economic growth is expected to continue this year – albeit somewhat slower than in previous years – the debt-to-GDP ratio is likely to continue falling. The return of inflation and the local currency kuna gaining ground against the euro are also factors which are likely to contribute to the reduction of the ratio,” RBA analysts said.

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