Finance Minister Zdravko Maric said on Saturday that Fitch's decision to raise Croatia’s credit rating was very good news and that he hopes his country will never again fall below the investment-grade level.

“We can all be satisfied, both the Republic of Croatia and all its citizens, entrepreneurs, taxpayers. It’s more good news from international financial circles. Fitch is the second credit rating agency which, after many years, has restored Croatia’s credit rating to the zone where it belongs, the investment credit rating zone,” Maric told reporters.

Fitch Ratings on Friday upgraded Croatia’s long-term foreign-currency issuer default rating to BBB- from BB+ with a positive outlook.

Maric said it was necessary to see to it that Croatia does not fall below the investment-grade level ever again because “we know well what the sub-investment zone meant and what effects it had also on the cost of debt and capital.”

Certain risks, such as the ailing Uljanik shipyard, have been recognised too but we have adequately addressed all those risks, he said, noting that Croatia has been recording a budget surplus for two and a public debt reduction for three years in a row.

Maric said he was pleased the Fitch report recognised the idea of introducing the Euro and the good macroeconomic indicators.

“That is positive news which suggests that Fitch is saying very clearly that the rating can be even better if we continue to deliver results, notably in public finance, macroeconomy and euro introduction,” he added.

He noted, however, that one must not turn a blind eye to the things Fitch indicated could be challenging, such as the enterprise and business climate, the state and the public administration, notably public companies and their corporate management, the energy sector and healthcare.

“If we want completely sustainable public finances, and we do, we must deliver additional results in those areas,” said Maric.

Asked if now was the right time to issue an international bond, he said he would say everything when the time came.

He recalled that two bonds were due for refinancing this year, one of US$ 1.5 billion on the international market and one of EUR 1 billion on the domestic market.

“We are making preparations, always looking two steps ahead, following the situation on the markets, and we believe this will be a positive incentive both on financial markets and the price and yield of our bonds,” said Maric.

He noted that a credit score upgrade was always related to the cost of debt and capital, not just the cost paid by taxpayers from the state budget, but the cost paid by all entrepreneurs and each citizen.

“We are carefully preparing everything and will choose the right time. This will be another year in which we will record a significant decrease of the total interest cost,” Maric said, adding that the amount paid on interest was reduced by almost HRK 3 billion in three years, to HRK 9 billion.