Croatia's GDP is set to shrink by 8.6% in 2020, according to the latest estimates made by the World Bank which has thus revised down its previous forecast which predicted a 9.3% contraction.

Croatia’s economy is expected to rebound at a rate of 5.4% in 2021, the World Bank said on Tuesday.

The country’s growth is likely to decelerate at a rate of 4.2% in 2022, when the national economy is expected to reach the pre-crisis levels.

In the regions of Europe and Asia, the COVID-19 pandemic adversely affected the countries with strong exchange of goods and services or strong financial connections with the euro area and those countries that depend on the services sectors, including Croatia, Kosovo and Montenegro, the WB says.

The pandemic caused a health and economic crisis in the region, and coronavirus numbers surged in the fourth quarter of 2020, making the governments extend or reintroduce anti-COVID restrictions, the WB recalls.