The general government debt in February 2019 was 1.4% up from the previous month and 2.1% from February 2018, totalling HRK 287.7 billion (approx. EUR 38.87 billion), show figures published by the Croatian National Bank (HNB).
After a report on excessive budget deficit and general government debt in April confirmed fiscal progress and noted a consolidated general government surplus for the second consecutive year as well as a continued decline in the general government debt’s share in GDP (to 74.6%), the latest HNB data show that the general government debt in February rose 1.4% from January and by 2.1% from February 2018, totalling HRK 287.7 billion at the end of February.
Compared to the end of 2018, the general government debt was almost three billion kuna or 1% higher, with the reported trends resulting from a rise in the internal component of public debt, analysts of Raiffeisen Bank (RBA) said.
Compared to February 2018, the debt was 2.1% or close to six billion kuna higher. The external component of public debt was HRK 4.4 billion or 4.1% down year-on-year and at the end of February amounted to HRK 104.6 billion.
The internal debt component was 10.5 billion kuna or 6.1% higher, totalling HRK 183.1 billion.
At the end of February, domestic guarantees issued by the general government amounted to HRK 3.4 billion, of which 1.7 billion referred to guarantees issued for loans of the Croatian Reconstruction and Development Bank (HBOR) while foreign guarantees totalled HRK 2.9 billion.
RBA analysts say that considering the forecast continuation of economic growth this year, the share of public debt in GDP is expected to continue falling.
The appreciation of the kuna against the euro is an additional factor that is expected to contribute to the reduction of the public debt’s share in GDP.
The analysts also expect the continued high liquidity and low interest rates on the European and domestic financial markets to make it possible for the state to successfully refinance its due liabilities.
Support for fiscal metrics is also expected from the tourist season, the analysts say, concluding that the expected trends would positively affect public debt statistics, if the growth of primary expenditure is kept below the growth of nominal GDP.
